Laspeyres price index uses which quantity weights?
A. Geometric mean of quantities
B. Current period quantities
C. Base period quantities
D. Average of base and current quantities
Answer: Option C
Solution (By JKSSB Mock Tests)
Laspeyres index = Σ(p₁q₀)/Σ(p₀q₀) × 100, using base period quantities (q₀) as weights, which may overstate inflation if consumers substitute away from goods with rising prices.
Explanation:
A random experiment has well-defined possible outcomes, can be repeated under similar conditions, and the exact outcome cannot be predicted with certainty before performing the experiment.
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