Exam 15: Index Numbers

An index of 239.2 represents a 239.2% change.

In 2000, an executive earned $100,000. In 2010, the executive earned $125,000. The CPI in 2000 was 172.2; the CPI in 2009 was 214.537. Using the CPI base, 1982-1984 = 100, what was the increase in real income from 2000 to 2009?

An example of a weight used in the calculation of a weighted index is quantity consumed in a base period.

Data for selected vegetables purchased at wholesale prices for 1995 and 2007 are shown below. What is the simple price relative for broccoli?

If the Laspeyres' index is 140.78 and the Paasche index is 98.01, what is the Fisher's Ideal Index?

Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown below. What is the interpretation of the value index?

What is the CPI called when it determines real income? ___________

Data for selected fruits purchased at wholesale prices for 2005 and 2009 are shown below. What is the value index?

An index number is a percent that measures the change from one period of time to another in terms of

Cost-of-living adjustments are based on the _______________________.

List some example items that are included in the CPI that represent a typical "market basket" of goods.

The following data was collected on mutual fund prices. Compute the Laspeyres index to compare mutual fund prices in 2010 to 2000.

As chief statistician for the county, you want to compute and publish every year a special-purpose index, which you plan to call Index of County Business Activity. Three series seem to hold promise as the basis for the index; namely, the price of cotton, the number of new cars sold, and the rate of money turnover for the county (published by a local bank). Arbitrarily you decide that money turnover should have a weight of 60 percent; number of new cars sold, 30 percent; and the price of cotton, 10 percent. What is the Index of County Business Activity for 1981 (the base year) and for 2006?

In the numerator of a value index, the price and quantity are both from the current period.

There are several indexes that reflect the overall economic activity in the United States. The federal government puts out an index of leading economic indicators. It includes such diverse economic indicators as stock prices, new orders for plants and equipment, and building permits issued. What are these indexes usually referred to as? _______________________

Describe the process of collecting data for the CPI.

The following data was collected comparing gasoline prices. Compute a simple aggregate index comparing gas prices in 2010 to gas prices in 2000.

Suppose your annual 2001 salary was $40,000 and your 2006 salary was $52,000. Assume the annual CPI rose from 177.1 to 202.9 during this period of time. What was the purchasing power of the dollar in 2001? _______

Data for fuel oil and gasoline purchased at wholesale prices for 2006 and 2010 are shown below. What is the simple price relative for fuel oil?

Which method for computing a weighted price index uses current year weights? _____________