Question

Using Paasche's formula, compute the quantity index for the year 2016 with 2011 as base year.

Commodity	Quantify (in Units)		Value (in ₹)
	2011	2016	2011	2016
A	5	100	6	150
B	100	150	500	900
C	80	100	320	500
D	60	72	150	360
E	30	33	360	297

Answer 1

Commodity	Quantity in 2011 (q0)	Quantity in 2016 (q1)	Price in 2011 (p0)	Price in 2016 (p1)	q1p1	q0p1
A	5	100	6	150	15000	750
B	100	150	500	900	135000	90000
C	80	100	320	500	50000	40000
D	60	72	150	360	25920	21600
E	30	33	360	297	9801	8910
					235721	161260

$$\begin{gathered} \mathbf{Paasche}\mathbf{\text{'}}\mathbf{s}\mathbf{}\mathbf{Index}\mathbf{}\mathbf{Number} \\ {q}_{01}\mathit{}=\frac{\mathrm{\Sigma }{q}_1{p}_1}{\mathrm{\Sigma }{q}_0{p}_1}\times 100 \\ \mathrm{or},q_{01}=\frac{235721}{161260}\times 100 \\ \Rightarrow q_{01}=146.17 \end{gathered}$$

Note: As per the textbook, the quantity index is 119.177. However, as per the above solution quantity index should be 146.17.