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The base year to calculate CPI-UNME is
  • a)
    1980-81
  • b)
    2001-02
  • c)
    2003-04
  • d)
    1984-85
Correct answer is option 'D'. Can you explain this answer?
Verified Answer
The base year to calculate CPI-UNME isa)1980-81b)2001-02c)2003-04d)198...
The base year to calculate CPI-UNME is 1984-85. 180 items are included in the index.
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The base year to calculate CPI-UNME isa)1980-81b)2001-02c)2003-04d)198...
The base year to calculate CPI-UNME is 1984-85.

Explanation:
The Consumer Price Index for Urban Non-Manual Employees (CPI-UNME) is a measure of inflation that is used to calculate the change in the average price level of goods and services consumed by urban non-manual employees.

Base Year:
The base year is the year against which the prices of goods and services in other years are compared to calculate the CPI. The base year is chosen as a reference point to measure the changes in prices over time.

Reasons for choosing 1984-85 as the base year:
Several factors are considered when selecting a base year for calculating the CPI-UNME. Here are some reasons why 1984-85 was chosen as the base year:

1. Representative of the Economy: The base year should be representative of the economy and reflect the consumption patterns of the target group, which in this case is urban non-manual employees. The year 1984-85 was chosen as it was considered to be a period when the consumption patterns of this group were relatively stable.

2. Data Availability: Sufficient and reliable data for various goods and services should be available for the base year. The year 1984-85 was chosen because it had a comprehensive dataset that could be used to calculate the CPI-UNME.

3. Stability: The base year should be a period of relative stability in terms of prices and economic conditions. The year 1984-85 was selected as it was a period when inflation was relatively low and the economy was not experiencing any major shocks or disruptions.

4. Relevance over Time: The base year should be relevant over an extended period of time to ensure consistency in the calculation of the CPI-UNME. The year 1984-85 was considered to be relevant for a significant duration, allowing for consistent comparisons of price changes over time.

Overall, the base year of 1984-85 was selected for the calculation of CPI-UNME based on its representativeness, data availability, stability, and relevance over time.
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The base year to calculate CPI-UNME isa)1980-81b)2001-02c)2003-04d)1984-85Correct answer is option 'D'. Can you explain this answer?
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