The time reversal test is satisfied if P₀₁ × P₁₀ = 1. This ensures: MCQ with Answer and Explanation

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The time reversal test is satisfied if P₀₁ × P₁₀ = 1. This ensures:

A. Index satisfies factor reversal

B. Index uses base year weights

C. Index is free from time bias

D. Index is the geometric mean

Answer: Option C

Solution (By JKSSB Mock Tests)

Time reversal test checks that the index is symmetrical over time.

This question belongs to: Accountancy and Statistics Statistics

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Practice More Statistics Questions

Question #1

Paasche's Price Index uses:

A. Fixed arbitrary weights

B. Base year quantities as weights

C. Current year quantities as weights

D. Average of base and current year quantities

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Correct Answer: Option C

Explanation:
Paasche uses current year quantities, which makes it reflective of current consumption patterns but suffers from downward bias.

This question belongs to: Accountancy and Statistics Statistics

Question #2

Life expectancy at birth is calculated using:

A. Infant mortality rate

B. Crude death rate only

C. Fertility rates

D. Age-specific death rates in a life table

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Correct Answer: Option D

Explanation:
Life expectancy is derived from a life table that uses age-specific death rates to compute survival probabilities and average remaining lifetime for a hypothetical cohort.

This question belongs to: Accountancy and Statistics Statistics

Question #3

A bag contains 3 red, 5 black balls. Two balls are drawn at random. The probability that they are of different colors is:

A. 15/28

B. 1/2

C. 3/8

D. 15/56

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Correct Answer: Option A

Explanation:
Total ways C(8,2)=28. 1 red 1 black = 3×5=15. Probability=15/28.

This question belongs to: Accountancy and Statistics Statistics

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