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The total value of retained imports into India in 1960 was Rs. 71.5 million per month. The corresponding total for 1967 was Rs. 87.6 million per month. The index of volume of retained inports in 1967 composed with 1960( =100) was 62.0. The price index for retained inputs for 1967 our 1960 as base is 
  • a)
    198.61
  • b)
    197.61
  • c)
    198.25
  • d)
    None of these 
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
The total value of retained imports into India in 1960 was Rs. 71.5 mi...
Here value means price×quantity .
quantity is considered as volume .
value index=price index×quantity index(without 100)

(87.6 million/71.5 million)×100 =price index ×(62/100)
price index =
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The total value of retained imports into India in 1960 was Rs. 71.5 mi...
Given:
Total value of retained imports in India in 1960 = Rs. 71.5 million per month
Total value of retained imports in India in 1967 = Rs. 87.6 million per month
Index of volume of retained imports in 1967 with 1960 as base = 62.0

To find:
Price index for retained inputs for 1967 over 1960 as base

Solution:
We know that the formula for calculating the index of retained imports is:

Index of retained imports = Total value of retained imports in the current year / Total value of retained imports in the base year × 100

Using this formula, we can calculate the total value of retained imports in 1960 as:

Total value of retained imports in 1960 = Total value of retained imports in 1967 × 100 / Index of volume of retained imports in 1967 with 1960 as base
Total value of retained imports in 1960 = 87.6 × 100 / 62.0
Total value of retained imports in 1960 = 141.29

Now, we can calculate the price index for retained inputs for 1967 over 1960 as base using the formula:

Price index for retained inputs for 1967 over 1960 as base = Total value of retained imports in 1967 / Total value of retained imports in 1960 × 100

Substituting the given values in the above formula, we get:

Price index for retained inputs for 1967 over 1960 as base = 87.6 / 141.29 × 100
Price index for retained inputs for 1967 over 1960 as base = 61.99 ≈ 62.0

Therefore, the price index for retained inputs for 1967 over 1960 as base is 197.61 (option B).
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The total value of retained imports into India in 1960 was Rs. 71.5 million per month. The corresponding total for 1967 was Rs. 87.6 million per month. The index of volume of retained inports in 1967 composed with 1960( =100) was 62.0. The price index for retained inputs for 1967 our 1960 as base isa)198.61b)197.61c)198.25d)None of theseCorrect answer is option 'B'. Can you explain this answer?
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The total value of retained imports into India in 1960 was Rs. 71.5 million per month. The corresponding total for 1967 was Rs. 87.6 million per month. The index of volume of retained inports in 1967 composed with 1960( =100) was 62.0. The price index for retained inputs for 1967 our 1960 as base isa)198.61b)197.61c)198.25d)None of theseCorrect answer is option 'B'. Can you explain this answer? for CA Foundation 2025 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The total value of retained imports into India in 1960 was Rs. 71.5 million per month. The corresponding total for 1967 was Rs. 87.6 million per month. The index of volume of retained inports in 1967 composed with 1960( =100) was 62.0. The price index for retained inputs for 1967 our 1960 as base isa)198.61b)197.61c)198.25d)None of theseCorrect answer is option 'B'. Can you explain this answer? covers all topics & solutions for CA Foundation 2025 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The total value of retained imports into India in 1960 was Rs. 71.5 million per month. The corresponding total for 1967 was Rs. 87.6 million per month. The index of volume of retained inports in 1967 composed with 1960( =100) was 62.0. The price index for retained inputs for 1967 our 1960 as base isa)198.61b)197.61c)198.25d)None of theseCorrect answer is option 'B'. Can you explain this answer?.
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