ML Aggarwal Index Number and Moving Averages ISC Class-11 Maths Understanding

ML Aggarwal Index Number and Moving Averages ISC Class-11 Maths Solutions Chapter-3. Step by step Solutions of ML Aggarwal ISC Class-11 Mathematics with Exe-3.1, Exe-3.2, and Chapter Test Questions. Visit official Website CISCE for detail information about ISC Board Class-11 Mathematics.

ML Aggarwal Index Number and Moving Averages ISC Class-11 Maths Solutions Chapter-3

Board	ISC
Class	11
Subject	Mathematics
Ch-3, Sec-C	Index Number and Moving Averages
Session	2024-25
Topics	Solutions of ML Aggarwal

Index Number and Moving Averages

Index Number : An index number is a statistical device for measuring changes in the magnitude of a group of related variables. It represents the general trend of diverging ratios from which it is calculated.
According to Croxton and Cowden, “Index numbers are devices for measuring difference in the magnitude of a group of related variables.”

Consumer Price Index or Cost of Living Index Number :

The consumer price index is the index number which measures the averages change in prices paid by the specific class of consumers for goods and services consumed by them in the current year in comparison with base year.

Construction of Consumer Price Index :

Selection of the consumer class
Information about the family budget
Choice of base year
Information about prices
Weightage – There are two ways of according weights
1. Quantity weight
2. Expenditure weight

Wholesale Price Index (WPI) :

The Wholesale Price Index (WPI) measures the relative changes in the prices of commodities traded in the wholesale markets. In India, the wholesale price index numbers are constructed on weekly basis.

Industrial Production Index :

The index number of industrial production measures changes in the level of industrial production comprising many industries. It includes the production of the public and the private sector. It is a weighted average of quantity relatives.

Agricultural Production Index :

Index number of agricultural production is weighted average of quantity relatives.

Sensex Sensex is the index showing changes in the Indian stock market. It is a short form of a Bombay Stock Exchange sensitive index. It is constructed with 1978-79 as the reference year or the base year. It consists of 30 stocks of leading companies in the country.

Purpose of Constructing Index Number

Purpose of constructing index number of prices is to know the relative change or percentage in the price level over time. A rising general price level over time is a pointer towards inflation, while a falling general price level over time is a pointer towards deflation.
Purpose of constructing index number of quantity is to know relative change or percentage change in the quantum or volume of output of different goods and services. A rising index of quantity suggests a rising level of economic activity and vice-versa.