The Laspeyres price index has the disadvantage that the consumption pattern in the initial period might be quite different from that in the current period and, hence, does not reflect accurately the current consumption cost.
Indicate whether the statement is true or false
Q. 2The Paasche price index has the disadvantage that current consumption quantities are usually hard to obtain.
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Q. 3The Paasche price index reflects more accurately the consumption cost at a point in time because it uses the consumption quantities in the initial year as the base.
Indicate whether the statement is true or false
Q. 4The Paasche price index uses the consumption quantities in the year of interest as the weights.
Indicate whether the statement is true or false
Q. 5The Laspeyres price index uses the initial consumption quantities as the weights.
Indicate whether the statement is true or false
Q. 6The Paasche price index is a form of unweighted aggregate price index.
Indicate whether the statement is true or false
Q. 7The Laspeyres price index is a form of weighted aggregate price index.
Indicate whether the statement is true or false
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