calculating index numbers

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Created by
Denuka Mahenthiran

Cards (6)

  • used to compare price changes over time
  • simple index numbers compare the price change of an item within its base year price
  • The index number for each year is that year’s price as a percentage of its base year price
  • The base year price has index number of 100 (meaning 100%) – this is the original amount
  • 𝑰𝒏𝒅𝒆𝒙 π‘΅π’–π’Žπ’ƒπ’†π’“ = π‘·π’“π’Šπ’„π’†/𝑩𝒂��𝒆 𝒀𝒆𝒂𝒓 π‘·π’“π’Šπ’„π’† Γ— 𝟏𝟎0
  • Index numbers show rates of change:
    • If the index number is >100, the value has increased.
    • If the index number is <100, the value has decreased