CA Foundation · Quantitative Aptitude · Index Numbers
The consumer price index (base 2012 = 100) was 250 in 2024. A pension of ₹10,000 per month in the base year is to be adjusted fully for price rise. What pension in 2024 keeps its purchasing power unchanged?
To keep purchasing power unchanged, multiply the base-year pension by the price index divided by 100. So 10,000 times 250/100 equals ₹25,000. The index of 250 means prices are two and a half times those of the base year.
- A₹12,500
- B₹15,000
- C₹25,000Correct
- D₹4,000
Explanation
Adjusted pension = 10,000 × 250/100 = ₹25,000. Adding only the index points as a percentage of 10,000 gives wrong amounts like 12,500. Using 100/250 gives ₹4,000, which inverts the ratio.
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