UPSC Exam  >  UPSC Questions  >  With reference to ‘Base effect’, ... Start Learning for Free
With reference to ‘Base effect’, consider the following statements:
  1. It is the impact that selecting a different reference point for a comparison between two data points can have on the comparison's outcome.
  2. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.
Which of the statements given above is/are correct?
  • a)
    1 only
  • b)
    2 only
  • c)
    Both 1 and 2
  • d)
    Neither 1 nor 2
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
With reference to ‘Base effect’, consider the following st...
As per revised estimates, India’s industrial output measured in terms of Index of Industrial Production (IIP) bounced back to rise 7.1% in November 2022, after plummeting 4.2% in October 2022 and this rise was aided by base effects.
What is a Base Effect?
  • The base effect is the impact that selecting a different reference point for a comparison between two data points can have on the comparison's outcome.
  • For Eg: In the context of inflation, the base effect is a distortion in a current inflation figure caused by exceptionally high or low levels of inflation in the previous reference period.
  • If the inflation rate was low in the corresponding period of the last year, then even a small increase in the price index will give a high rate of inflation in the current year.
  • When comparing two data points, choosing a reference point will be crucial as the base effect can highly distort or mislead the interpretation of numbers.
  • The base effect could also result in major differences in percentage comparisons. If we chose a reference point that is too low, there could be an overestimation and if the base is too high, it could result in gross underestimation of the situation.
Hence only statement 1 is correct.
Free Test
Community Answer
With reference to ‘Base effect’, consider the following st...
The correct answer is option 'A' - 1 only.
Explanation:
- Base Effect:
The base effect refers to the impact that selecting a different reference point for a comparison between two data points can have on the outcome of the comparison. It is a common concept in economics and statistics.
- Correct Statement:
The first statement is correct as it accurately describes the base effect. By choosing different reference points for comparison, the interpretation of numbers or percentage comparisons can indeed be influenced by the base effect.
- Incorrect Statement:
The second statement is incorrect because the base effect can indeed distort or mislead the interpretation of numbers or percentage comparisons. If not taken into consideration, the base effect can lead to incorrect conclusions or misinterpretations of data.
In conclusion, understanding the base effect is crucial in correctly interpreting data and making informed decisions based on comparisons. It is essential to be aware of how different reference points can impact the outcome of comparisons and to consider this factor when analyzing data.
Explore Courses for UPSC exam

Similar UPSC Doubts

Top Courses for UPSC

With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?
Question Description
With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? for UPSC 2024 is part of UPSC preparation. The Question and answers have been prepared according to the UPSC exam syllabus. Information about With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for UPSC 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?.
Solutions for With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for UPSC. Download more important topics, notes, lectures and mock test series for UPSC Exam by signing up for free.
Here you can find the meaning of With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer?, a detailed solution for With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice With reference to ‘Base effect’, consider the following statements: It is the impact that selecting a different reference point for a comparison between two data points can have on the comparisons outcome. Base effect cannot distort or mislead the interpretation of numbers/percentage comparisons.Which of the statements given above is/are correct?a)1 onlyb)2 onlyc)Both 1 and 2d)Neither 1 nor 2Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice UPSC tests.
Explore Courses for UPSC exam

Top Courses for UPSC

Explore Courses
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev