CA Foundation · Quantitative Aptitude · Index Numbers
The Consumer Price Index (base 2012 = 100) for a city was 250 in 2024. A pensioner received ₹18,000 per month in 2012. What monthly pension in 2024 would keep his real purchasing power unchanged?
The pension should be ₹45,000. Maintaining purchasing power requires scaling income by the price index ratio: 18,000 × 250/100 = ₹45,000. Prices have risen 150% over the base, so the pension must be 2.5 times the base-year amount.
- A₹36,000
- B₹45,000Correct
- C₹40,500
- D₹72,000
Explanation
To maintain purchasing power, the pension should rise in proportion to the index. Required pension = 18,000 × 250/100 = ₹45,000. Check: 45,000/18,000 = 2.5 = 250/100. ₹36,000 is wrong because it adds only 100% (a doubling) instead of scaling by 2.5.
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