Question

Given that $∑p_0q_0$ = 700, $∑p_0q_1$ = 1450, $∑p_1q_0$ = 855 and $∑p_1q_1$ = 1300. Where subscripts 0 and 1 are used for the base year and a current year respectively. The Laspeyer's price index number is:

• A. 118.46
• B. 119.35
• C. 120.23
• D. 122.14

Answer 1

Answer: (D)

122.14

Answer 2

Based on the given information we can calculate,

Laspeyer's price index number is

= $\frac {\sum P_1Q_0 }{\sum P_0Q_0} \times 100$

= $\frac{855}{700} \times100$

= $122.14$

Hence, the correct option is (D): $122.14$