PRC-2 · Chapter 9 · Question 26 of 60
A chain index series demonstrates annual sales index figures of 107.0, 115.02, and 123.07 for three consecutive years. What does this progression indicate?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) A compounding annual sales growth.
Explanation
A steadily rising chained index graphically indicates that the annual sales growth is compounding year over year.
More Indices MCQs
- Q28If the base period price of Material A is Rs. 0.50 and the current period price is Rs. 0.75, what is the exact price relative?
- Q29When converting a nominal wage into a real wage, what mathematical role does the price index play?
- Q30Why do statisticians periodically engage in the practice of 'base shifting' when maintaining long-term index numbers?
- Q31When maintaining a long-term index series, what is the statistical process of 'base shifting'?
- Q32How is 'Real Income' or true purchasing power mathematically calculated using the Consumer Price Index (CPI)?