CA Foundation · Quantitative Aptitude · Index Numbers
Which of the following best describes an index number in statistics?
An index number is a specialised average that measures the relative change in a variable or a group of related variables over time or between places. It expresses the current value as a percentage of a base value, which is why it is called an economic barometer.
- AA specialised average that measures the relative change in a variable or group of variables over time or placeCorrect
- BA measure of dispersion showing the spread of items around the mean
- CA measure of the strength of the linear relationship between two variables
- DA graph showing the cumulative frequency of a distribution
Explanation
An index number is described as a specialised average that expresses the relative change in a variable or group of related variables between two periods or places. Dispersion, correlation and ogives are different statistical tools and do not describe index numbers.
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