A Composite price index where the prices of the items in the composite are weighted by their relative importance is called the
A) Price relative.
B) Weighted aggregate price index.
C) Paasche index.
D) Quantity index.

Question

Quizplus · Accepted Answer

A composite price index that weights the prices of the items in the composite by their relative importance is called a weighted aggregate price index. This type of index is commonly used to measure changes in inflation or the cost of living, and is considered more accurate than a simple price relative or quantity index. The Paasche index is another type of weighted price index, but it weights the quantities of the items rather than their prices.

A Composite Price Index Where the Prices of the Items