CA Foundation · Quantitative Aptitude · Index Numbers
A worker's money wage rose from ₹18,000 in the base year to ₹27,000 in the current year. The consumer price index for the current year is 180 (base year = 100). What is the percentage change in his real wage?
His real wage fell by 16.67 per cent. Deflating the current wage of ₹27,000 by the index 180 gives ₹15,000, compared with ₹18,000 in the base year. The decline of ₹3,000 on ₹18,000 is 16.67 per cent.
- AA decrease of 16.67%Correct
- BAn increase of 50%
- CA decrease of 10%
- DNo change
Explanation
Real wage = money wage / CPI × 100. Current real wage = 27,000/180 × 100 = ₹15,000. Base real wage = ₹18,000. Change = (15,000 - 18,000)/18,000 = -16.67%. The 50% option ignores the price rise.
Did you get it right without looking?
One question tells you little. A timed set on Index Numbers shows your real accuracy, how long you take and where you lose marks.
More Index Numbers questions
- A price index series on base 2012 = 100 shows 180 for 2020. A new series with base 2020 = 100 shows 125 for 2024. Splicing the new series on…
- An index number in year 2023 is 145 with base year 2020. In year 2024, the index becomes 160. What is the rate of change in the index from 2…
- A Laspeyres price index for a group of items is 120. Using the same data, the Paasche price index is 100. Which statement about the source o…
- Which one of the following is a problem in the construction of an index number, as opposed to a mere misuse of a finished index?
- For two commodities, the data are: A: p0 = 10, q0 = 5, p1 = 12, q1 = 6; B: p0 = 20, q0 = 10, p1 = 25, q1 = 8. What is the Paasche price inde…
- For a firm's products, Σp0q0 = ₹400, Σp1q0 = ₹500, Σp0q1 = ₹500 and Σp1q1 = ₹900 (thousand). What is Fisher's ideal quantity index for the c…