Index numbers Flashcards
1
Q
Name 2 reasons to use index numbers
A
- Easy to analyse
- Avoids comparison of potentially huge numbers
- Useful to analyse range of economic data:
House prices
Inflation
Exchange rates
Economic growth
2
Q
What is the base year?
A
The selected point at which the other raw data is compared to.
3
Q
What is the number for the base year?
A
100
4
Q
What’s the formula for percentage change?
A
Old - New
————— X100
Old
5
Q
How do you calculate index numbers?
A
RawNumber
——————————- X100
BaseYearRawNumber
6
Q
How do you calculate real GDP
A
