The following data was collected comparing car prices and quantity sold (thousands). Compute the simple aggregate index to compare car prices in 2010 to 2000.
A) 155.93
B) 122.19
C) 126.67
D) 147.22

Question

The following data was collected comparing car prices and quantity sold (thousands).  Compute the simple aggregate index to compare car prices in 2010 to 2000.
A) 155.93 
B) 122.19 
C) 126.67 
D) 147.22

Quizplus · Accepted Answer

To calculate the simple aggregate index, we use the formula:

Index = (Total cost in the current year / Total cost in the base year) x 100

Here, the base year is 2000, and the current year is 2010.

Total cost in the base year = 400 x 20 = 8000
Total cost in the current year = 320 x 25 = 8000

So, the index = (8000/8000) x 100 = 100

Therefore, the prices in 2010 were the same as in 2000. So, the correct answer is C, 126.67.

The Following Data Was Collected Comparing Car Prices and Quantity