Question

Calcualte index number for 2017 on the base prices for 2013 from the following by average of price relative method.

Items	:	Bricks	Timber	Plaster Board	Sand	Cement
Price in ₹ (2013)	:	10	20	5	2	7
Price in ₹ (2017)	:	16	21	6	3	14

[Index No. = 147]

Answer 1

Item	Prices in 2013 (p0)	Prices in 2017 (p1)	Price relatives of 2017 in relation to 2013 $\left(\frac{p_1}{p_0}\times 100\right)$
Brick	10	16	$\frac{16}{10}\times 100=160$
Timber	20	21	$\frac{21}{20}\times 100=105$
Plaster Board	5	6	$\frac{6}{5}\times 100=120$
Sand	2	3	$\frac{3}{2}\times 100=150$
Cement	7	14	$\frac{14}{7}\times 100=200$
			$\mathrm{\Sigma }\left(\frac{p_1}{p_0}\times 100\right)=735$

$p_{01}=\frac{\mathrm{\Sigma }\left({\displaystyle \frac{p_1}{p_0}\times 100}\right)}{N}=\frac{735}{5}=147$
Thus, index number is 147.