Page 279 - DECO504_STATISTICAL_METHODS_IN_ECONOMICS_ENGLISH

Unit 21: Cost of Living Index and Its Uses and Limitations of Index Numbers

21.5 Review Questions Notes

1. What is meant by cost of living Index number ? What are its uses ?
2. How are cost of living Index number constructed ?
3. Explain briefly the various methods of construction of cost of living index number.
4. What are the limitations of index numbers.
5. What do you understand by cost of living index numbers ? Describe briefly the various steps
involved in their construction.
Answers: Self-Assessment

1. (i) Median (ii) ∑ pq
10
∑ pq q 1 + q 2 .....q n
(iii) 1 × 100 , where q =
∑ pq n
0
(iv) read (v) money
21.6 Further Readings

1. Elementary Statistical Methods; SP. Gupta, Sultan Chand & Sons,
New Delhi - 110002.
2. Statistical Methods — An Introductory Text; Jyoti Prasad Medhi, New Age
International Publishers, New Delhi - 110002.
3. Statistics; E. Narayanan Nadar, PHI Learning Private Limied, New Delhi - 110012.
4. Quantitative Methods—Theory and Applications; J.K. Sharma, Macmillan
Publishers India Ltd., New Delhi - 110002.

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