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With reference to the Wholesale Price Index (WPI), consider the following statements:
- The index has a total of 697 items, including Primary Articles (117), fuel and power (16), and Manufactured Products (564).
- Currently, the base year of WPI is 2019.
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?
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Most Upvoted Answer
With reference to the Wholesale Price Index (WPI), consider the follow...
The WPI inflation has fallen into negative for the first time since July 2020.
- According to data released by the Ministry of Commerce and Industry, INFLATION RATE based on Wholesale Price Index (WPI) fell to a near three-year low of (-) 0.92 % in April, slipping into negative territory for the first time in 33 months.
- Causes:
- A high base effect along with moderation in global commodity prices reflected in easing of food, fuel and other input costs.
- The decline in the WPI inflation rate in April 2023 was primarily contributed by fall in prices of basic metals, food products, mineral oils, textiles, non-food articles etc.
What Is a Wholesale Price Index (WPI)?
- Wholesale Price Index (WPI) represents the price of goods at a wholesale stage i.e. goods that are sold in bulk and traded between organizations instead of consumers.
The index has a total of 697 items, including Primary Articles (117), fuel and power (16), and Manufactured Products (564).
- The percentage increase in WPI over a year gives the rate of inflation for that year.
- Currently, the base year of WPI is 2011-12.
- WPI is used as an important measure of inflation in India.
What is a Base Effect?
- The base effect refers to the effect that the choice of a basis of comparison or reference can have on the result of the comparison between data points.
- It often involves the use of some kind of ratio or index value between two points in a time-series data set and can also apply to cross-sectional or other types of data.
Hence only statement 1 is correct.
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Community Answer
With reference to the Wholesale Price Index (WPI), consider the follow...
Statement 1: The index has a total of 697 items, including Primary Articles (117), fuel and power (16), and Manufactured Products (564).
This statement is correct. The Wholesale Price Index (WPI) is a measure of average changes in the prices of goods at the wholesale level in the economy. It covers a total of 697 items which are divided into three major groups: Primary Articles, Fuel and Power, and Manufactured Products. Primary Articles include items like food articles, non-food articles, and minerals. Fuel and Power include items like coal, electricity, and petrol. Manufactured Products include items like textiles, chemicals, machinery, and vehicles. Therefore, the statement is correct.
Statement 2: Currently, the base year of WPI is 2019.
This statement is incorrect. The base year of the Wholesale Price Index (WPI) is the year against which the index is measured and compared. The base year is periodically revised to reflect the changes in the structure of the economy and the relative importance of different items. The current base year of the WPI is 2011-12. This means that the price levels of the items in the index are measured and compared to the price levels of the same items in the base year 2011-12. Therefore, the statement is incorrect.
In conclusion, only Statement 1 is correct and Statement 2 is incorrect.
This statement is correct. The Wholesale Price Index (WPI) is a measure of average changes in the prices of goods at the wholesale level in the economy. It covers a total of 697 items which are divided into three major groups: Primary Articles, Fuel and Power, and Manufactured Products. Primary Articles include items like food articles, non-food articles, and minerals. Fuel and Power include items like coal, electricity, and petrol. Manufactured Products include items like textiles, chemicals, machinery, and vehicles. Therefore, the statement is correct.
Statement 2: Currently, the base year of WPI is 2019.
This statement is incorrect. The base year of the Wholesale Price Index (WPI) is the year against which the index is measured and compared. The base year is periodically revised to reflect the changes in the structure of the economy and the relative importance of different items. The current base year of the WPI is 2011-12. This means that the price levels of the items in the index are measured and compared to the price levels of the same items in the base year 2011-12. Therefore, the statement is incorrect.
In conclusion, only Statement 1 is correct and Statement 2 is incorrect.
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With reference to the Wholesale Price Index (WPI), consider the following statements: The index has a total of 697 items, including Primary Articles (117), fuel and power (16), and Manufactured Products (564). Currently, the base year of WPI is 2019.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?
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