Data for selected vegetables purchased at wholesale prices for 1995 and 2000 are shown below. What is the interpretation of the value index?
A) Total value of purchases rose 10.3%
B) Total value of purchases rose 18.5%
C) Total value of purchases fell 1.6%
D) Total value of purchases rose 8%
E) Total value of purchases rose 15.6%

Question

Data for selected vegetables purchased at wholesale prices for 1995 and 2000 are shown below.  What is the interpretation of the value index?
A) Total value of purchases rose 10.3% 
B) Total value of purchases rose 18.5% 
C) Total value of purchases fell 1.6% 
D) Total value of purchases rose 8% 
E) Total value of purchases rose 15.6%

Quizplus · Accepted Answer

The value index compares the total value of purchases in 2000 to the total value of purchases in 1995. The formula for value index is (total value of purchases in a given year/total value of purchases in the base year) x 100. Using the given data, the value index is (117,500/101,600) x 100 = 115.6. This means that the total value of purchases rose by 15.6%. Therefore, the best choice is E.

Data for Selected Vegetables Purchased at Wholesale Prices for 1995