CA Foundation · Quantitative Aptitude · Index Numbers
An old CPI series (base 2015 = 100) reads 160 for 2018 and 200 for 2020, and was then discontinued. A new CPI series (base 2020 = 100) reads 120 for 2024. A worker earned ₹40,000 per month in 2018. To keep the same real purchasing power in 2024, the required monthly salary is:
The required salary is ₹60,000. Splicing puts the 2024 CPI on the old base at 240 (120 × 200/100). Compared with 160 in 2018, prices rose by a factor of 1.5, so ₹40,000 must become ₹60,000 to keep real income unchanged.
- A₹60,000Correct
- B₹48,000
- C₹96,000
- D₹50,000
Explanation
Splice the series: 2024 on the old base = 120 × 200/100 = 240. Required salary = 40,000 × 240/160 = ₹60,000. Using only 120/100 ignores the old-series rise and gives ₹48,000. Using 240/100 ignores the 2018 level and gives ₹96,000. Stopping at 2020 gives 40,000 × 200/160 = ₹50,000.
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 with base 2014 = 100 gives 125 for 2016, 150 for 2019 and 200 for 2022. The base is shifted to 2016 = 100. What is the …
- A consumer price index with base 2010 = 100 reads 160 for 2015 and 240 for 2022. A clerk earned ₹48,000 per month in 2015 and earns ₹66,000 …
- Index numbers are often described as 'economic barometers'. What does this description mainly convey?
- The wholesale price index (base 2016 = 100) for a commodity group is 125 in 2020 and 150 in 2024. A trader says that prices rose by 25% betw…
- The Consumer Price Index (base 2015 = 100) is 250 for 2024. A worker's salary was ₹30,000 in 2015. Which monthly salary in 2024 would keep h…
- A consumer price index with base 2012 = 100 was discontinued when it read 200 in 2019. A new series with base 2019 = 100 reads 130 in 2023. …