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Test: Index Numbers- 6

40 Questions MCQ Test Quantitative Aptitude for CA CPT | Test: Index Numbers- 6

Description

This mock test of Test: Index Numbers- 6 for CA Foundation helps you for every CA Foundation entrance exam. This contains 40 Multiple Choice Questions for CA Foundation Test: Index Numbers- 6 (mcq) to study with solutions a complete question bank. The solved questions answers in this Test: Index Numbers- 6 quiz give you a good mix of easy questions and tough questions. CA Foundation students definitely take this Test: Index Numbers- 6 exercise for a better result in the exam. You can find other Test: Index Numbers- 6 extra questions, long questions & short questions for CA Foundation on EduRev as well by searching above.

QUESTION: 1

With regard to Laspeyre and Paasche price index numbers, it is maintained that If the Prices of all the goods change in the same ratio, the two indices will be equal for them the weighting system is irrelevant; or if the quantities of all the goods change in the same ratio, they will be equal, for them the two weighting systems are the same relatively. Then the above statements satisfy.

A.
Laspeyre Price index ≠ Paasche Price Index.
B.
Laspeyre Price Index = Paasche Price Index.
C.
Laspeyre Price Index may be equal Paasche Price Index.
D.
None of these.

Solution:

QUESTION: 2

Circular Test is satisfied by

A.
Laspeyre Index number.
B.
Paasche index number.
C.
The simple geometric mean of price relatives and the weighted aggregative with fixed weights.
D.
None of these.

Solution:

QUESTION: 3

The price level of a country in a certain year has increased 25% over the base period. The index number is

A.
25
B.
125
C.
225
D.
2500

Solution:

QUESTION: 4

If the ratio between Laspeyre index number and Paasche Index number is 28:27. Then the missing figure in the following table P is:

A.
7
B.
4
C.
3
D.
9

Solution:

QUESTION: 5

Paasche index is based on

A.
Base year quantities
B.
Current year quantities.
C.
Average of current and base year.
D.
None of these.

Solution:

QUESTION: 6

Fisher ideal index number is

A.
The Median of Laspeyre and Paasche index numbers
B.
The Arithmetic Mean of Laspeyre and Paasche index numbers
C.
The Geometric Mean of Laspeyre and Paasche index numbers
D.
None of these

Solution:

QUESTION: 7

Time reversal Test is satisfied by following index number formula is

A.
Laspeyre Index number.
B.
Simple Arithmetic Mean of price relative formula
C.
Marshall -Edge worth formula.
D.
None of these.

Solution:

QUESTION: 8

If the index number of prices at a place in 1994 is 250 with 1984 as base year, then the prices have increased on average by

A.
250%
B.
150%
C.
350%
D.
None of these.

Solution:

QUESTION: 9

The factor reversal test is satisfied by

A.
Simple aggregative index number.
B.
Paasche index number.
C.
Laspeyre index number.
D.
None of these.

Solution:

QUESTION: 10

Fisher index number is based on

A.
The Arithmetic mean of Laspeyre and Paasche index numbers
B.
The Median of Laspeyre and Paasche index numbers.
C.
The Mode of Laspeyre nad Paasche index numbers.
D.
None of these.

Solution:

QUESTION: 11

The circular test is satisfied by

A.
Fisher index number.
B.
Paasche index number.
C.
Laspeyre index number.
D.
None of these.

Solution:

QUESTION: 12

If the prices of all commodities in a place have increased 1.25 times in comparison to the base period, the index number of prices of that place now is

A.
125
B.
150
C.
225
D.
None of these.

Solution:

QUESTION: 13

If the prices of all commodities in a place have decreased 35% over the base period prices, then the index number of prices of that place is now

A.
35
B.
135
C.
65
D.
None of these.

Solution:

QUESTION: 14

The time reversal test is satisfied by

A.
Fisher index number.
B.
Paasche index number.
C.
Laspeyre index number.
D.
None of these.

Solution:

QUESTION: 15

The best average for constructing an index numbers is

A.
Arithmetic Mean
B.
Harmonic Mean
C.
Geometric Mean
D.
None of these.

Solution:

QUESTION: 16

Simple aggregate of quantities is a type of

A.
Quantity control
B.
Quantity indices
C.
Both
D.
None

Solution:

QUESTION: 17

Theoretically, G.M. is the best average in the construction of index numbers. but in practise, mostly the A.M. is used

A.
False
B.
True
C.
Both
D.
None

Solution:

QUESTION: 18

Laspeyre or Paasche or the Fisher ideal index do not satisfy

A.
Time Reversal Test
B.
Unit Test
C.
Circular Test
D.
None

Solution:

QUESTION: 19

Fisher Ideal Formula does not satisfy _________test

A.
Unit Test
B.
Circular test
C.
Time Reversal Test
D.
None

Solution:

QUESTION: 20

Laspeyre and Paasche method _________time reversal test

A.
Satify
B.
Do not satisfy
C.
Are
D.
Are not

Solution:

QUESTION: 21

The number of test of Adequacy is

A.
2
B.
5
C.
3
D.
4

Solution:

QUESTION: 22

There is no such thing as unweighted index numbers

A.
False
B.
True
C.
Both
D.
None

Solution:

QUESTION: 23

The test of shifting the base is called

A.
Unit Test
B.
Time Reversal Test
C.
Circular Test
D.
None

Solution:

QUESTION: 24

Each of the following statements is either True or False. Write your choice of the answer by writing F for false.

A.
Geometric mean is the most appropriate average to be used for constructing an index number.
B.
Weighted average of relatives and weighted aggregative methods render the same result.
C.
Fisher Ideal Index Number is a comprise between two well known indices - not a right compromise, economically speaking.
D.
Like all statistical tools, index numbers must be used with great caution.

Solution:

QUESTION: 25

_______________is concerned with the measurement of price changes over a period of years, when it is desirable to shift the base

A.
Unit Test
B.
Circular test
C.
Time Reversal Test
D.
None

Solution:

QUESTION: 26

We use price index numbers

A.
To measure and compare prices
B.
To measure prices
C.
To compare prices
D.
None

Solution:

QUESTION: 27

Each of the following statements is either True or False write your choice of the answer by writing T for True

A.
Index Numbers are the sign and guideposts along the buisness highway that indicate to the businessman how he should drive or manage.
B.
For Construction index number, the best method on theoretical ground is not the best method from practical point of view.
C.
Weighting index numbers makes them less representative.
D.
Fisher index number is not an ideal index number.

Solution:

QUESTION: 28

________________satisfies circular test

A.
G.M. of price or the weighted aggregate with fixed weights
B.
A.M. of price relatives or the weighted aggregate with fixed weights
C.
H.M. of price relatives or the weighted aggregate with fixed weights
D.
None

Solution:

QUESTION: 29

The ratio of price of single commodity in a given period to its price in another period is called the

A.
Base period
B.
Price ratio
C.
Relative price
D.
None

Solution:

Option (a) base period is right answer.

Explanation:-

Base period or reference period refers to the period of time used as the basis for an index number, for comparison with other periods

QUESTION: 30

When the product of price index and the quantity index is equal to the corresponding value index then the test that holds is

A.
Unit Test
B.
Time Reversal Test
C.
Factor Reversal Test
D.
None holds

Solution:

QUESTION: 31

Index numbers are often constructed from the

A.
Frequency
B.
Classes
C.
Sample
D.
None

Solution:

QUESTION: 32

Laspeyre method and Paasche method do not satisfy

A.
Unit Test
B.
Time Reversal Test
C.
Factor Reversal Test
D.
None

Solution:

QUESTION: 33

P₁₀ is the index for time

A.
1 on 0
B.
0 on 1
C.
1 on 1
D.
0 on 0

Solution:

QUESTION: 34

P₀₁ is the index for time

A.
1 on 0
B.
0 on 1
C.
1 on 1
D.
0 on 0

Solution:

QUESTION: 35

The formula should be independent of the unit in which or for which price and quantities are quoted in

A.
Unit Test
B.
Time Reversal Test
C.
Factor Reversal Test
D.
None

Solution:

QUESTION: 36

____________is a point of reference in comparing various data describing individual behaviour.

A.
Sample
B.
Base period
C.
Estimations
D.
None

Solution:

QUESTION: 37

Fisher Ideal Formula for calculating index numbers satisfied the __________tests

A.
Units Test
B.
Factor Reversal Test
C.
Both
D.
None

Solution:

QUESTION: 38

The purpose determines the type of index number to use

A.
Yes
B.
No
C.
May be
D.
May not be

Solution:

QUESTION: 39

The index number is a special type of average

A.
False
B.
True
C.
Both
D.
None

Solution:

QUESTION: 40

The choice of suitable base period is at best temporary solution

A.
True
B.
False
C.
Both
D.
None

Solution:

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Test: Index Numbers- 6

40 Questions MCQ Test Quantitative Aptitude for CA CPT | Test: Index Numbers- 6

Circular Test is satisfied by

The price level of a country in a certain year has increased 25% over the base period. The index number is

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