PRC-2 · Chapter 9 · Question 33 of 60
In index construction theory, what is Fisher's Ideal Index fundamentally defined as?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The geometric mean (square root of the product) of the Laspeyres and Paasche indices.
Explanation
Fisher's Ideal Index resolves the respective biases of the Laspeyres and Paasche indices by mathematically crossing them, taking the strict geometric mean of the two.
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