Category Business Mathematics

Fisher Price Index

In order to combine the effects of both Paasche and Laspeyre price index, Fisher presented a new formula to calculate price index. It is defined as the geometric mean of Paasche and Laspeyre price indices.  Formula

Paasche Price Index

n this price index, we use the current year quantitties of commodities as weights. That is why it is also called Current Year Weighted Average Index Number & is denoted by P. Formula

Laspeyre’s Price Index

In this price index, we use the base year quantitties as weights. That is why it is also called Base Year Weighted Average Index Number & is denoted by L. Formula This price index is valuable only when the difference…

Weighted Index Numbers

In order to give each commodity a relative importance, a number is assigned which is called weights. In Price index numbers, quantities of commodities in the base or current year are normally used as weights. Types of Weighted Index Numbers…

Types of Index Numbers

Index numbers are broadly categorized into three main index numbers as follows: Price Index Number – this is used to measure the changes in the price from one period to the other. Quantity Index Number – this is used to…

Index Numbers

Index numbers are used to measure the changes happened in a variable over a period of time. This is an effective method to analyze the variable and how it has affected the related factors. In our daily life, it usage…

Mode

Mode is the value which occurs most frequently in the given set of data. If the distribution has one mode, it is called Uni-modal distribution, while distribution with two modes is called Bi-modal distribution. Distribution which has more than two…

Median

Median is simply defined as the most middle value of an arranged data. It means that it divided the data into two equal portions. Formula Median = (n + 1 / 2) th value Example Find median of the following…

Arithmetic Mean

It is one of the most common and popular measure of central tendency. It is defined as the sum of all the observations divided by the number of observations. It is denoted by A.M. The major problem with A.M is…

Averages in Statistics

As statistics is about aggregate of numerical facts, it cannot be explained in singular manner. In order to present the data singularly, the averages are calculated and described. The average calculated in such a manner is the representative of most…