Y12 Booklet 1: Index Numbers & Handling Data Flashcards
1
Q
What is the advantage of using Index numbers?
A
easier to see changes between years
2
Q
How do Index numbers work?
A
“base year” is set to 100
all other years are given a value relative to 100, using percentage differences
3
Q
How should a change between 2 numbers be shown?
A
as a percentage of the original
4
Q
How should a change between 2 percentages be shown?
A
in percentage points (pp)
5
Q
What is a nominal value?
A
the literal numeric values which appear for prices or incomes etc.
6
Q
What is a real value?
A
the actual value compared to previous prices and adjusted for inflation, aka the spending power
7
Q
What is the formula for nominal GDP?
A
P from year 1 x Q from year 1
8
Q
What is the formula for real GDP?
A
P from year 1 x Q from year 2
