Question
Calculate Walsh’s price Index Number for the following data.
Commodity Base Year Current Year
Price Quantity Price Quantity
I 10 12 40 3
II 20 2 25 8
III 30 3 50 27
IV 60 9 90 36

Answer

Construct the following table:
Commodity Base
Year
Current
Year
$\sqrt{ q _1 q _1}$ $p _0 \sqrt{ q _0 q _1}$ $p_1 \sqrt{q_0 q_1}$
$p_0$ $q_0$ $p_1$ $q_1$
I 10 12 40 3 6 60 240
II 20 2 25 8 4 80 100
III 30 3 50 27 9 270 450
IV 60 9 90 36 18 1080 1620
Total 1490 2410

From the table, $\sum p _0 \sqrt{ q _0 q _1}=1490, \sum p _1 \sqrt{ q _0 q _1}=2410$

Walsh's Price Index Number:
$ P_{01}(W)=\frac{\sum p_1 \sqrt{q_0 q_1}}{\sum p_0 \sqrt{q_0 q_1}} \times 100$
$=\frac{2410}{1490} \times 100$
$=161.74 $

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