PPT 16 - Index Numbers Notes | Study Business Mathematics and Logical Reasoning & Statistics - CA Foundation

CA Foundation: PPT 16 - Index Numbers Notes | Study Business Mathematics and Logical Reasoning & Statistics - CA Foundation

The document PPT 16 - Index Numbers Notes | Study Business Mathematics and Logical Reasoning & Statistics - CA Foundation is a part of the CA Foundation Course Business Mathematics and Logical Reasoning & Statistics.
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 Page 1


CPT Section D Quantitative Aptitude, Chapter 16 
Dr. N.V. Ravi 
Page 2


CPT Section D Quantitative Aptitude, Chapter 16 
Dr. N.V. Ravi 
Introduction Involved in the construction of Index 
Numbers 
Construction of Index number 
Methods of Index Numbers 
Usefulness of Index Numbers  
Page 3


CPT Section D Quantitative Aptitude, Chapter 16 
Dr. N.V. Ravi 
Introduction Involved in the construction of Index 
Numbers 
Construction of Index number 
Methods of Index Numbers 
Usefulness of Index Numbers  
An index number is a ratio or an average of 
ratios expressed as a percentage two or more 
time periods are involved, one of which is base 
time period. 
The value of the base time period serves as the 
standard point of composition 
Page 4


CPT Section D Quantitative Aptitude, Chapter 16 
Dr. N.V. Ravi 
Introduction Involved in the construction of Index 
Numbers 
Construction of Index number 
Methods of Index Numbers 
Usefulness of Index Numbers  
An index number is a ratio or an average of 
ratios expressed as a percentage two or more 
time periods are involved, one of which is base 
time period. 
The value of the base time period serves as the 
standard point of composition 
Selection of data  
Selection of a Base Year 
Type of Formula 
Selection of Weights 
The Data for Index Numbers 
Choice of Variables 
Page 5


CPT Section D Quantitative Aptitude, Chapter 16 
Dr. N.V. Ravi 
Introduction Involved in the construction of Index 
Numbers 
Construction of Index number 
Methods of Index Numbers 
Usefulness of Index Numbers  
An index number is a ratio or an average of 
ratios expressed as a percentage two or more 
time periods are involved, one of which is base 
time period. 
The value of the base time period serves as the 
standard point of composition 
Selection of data  
Selection of a Base Year 
Type of Formula 
Selection of Weights 
The Data for Index Numbers 
Choice of Variables 
1 
• Specialized Averages  
2 
• Measure the net change in a group 
of related variables 
3 
• Measures the effect of changes 
over a period of time 
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