Question

When index number is calculated for several variables, it is called:

• A. Composite index
• B. Whole sale price index
• C. Volume index
• D. Simple index

Answer 1

The correct option is A Composite index

$\Rightarrow$ When index number is calculated for several variables, it is called : $Compositeindex.$

$\Rightarrow$ A composite index number is formed by combining two or more index numbers, and a weighting is usually given to each of the index in order to calculate the weighted average index number.

$\Rightarrow$ A composite index number is a number that measures an average relative changes in a group of relative variables with respect to a base.