Q.2 (A) (iii) Identify and explain the concept : Gopal collected information about output of rice, wheat, cotton and jowar produced in 2016 and 2020 and derived Index Number.
Best answer
Answer: Quantity index number
Concept: Quantity index number.
Explanation: A quantity index number measures the relative change in the physical quantity (volume) of goods produced, consumed or sold in the current year compared with the base year. Here Gopal compares the output of rice, wheat, cotton and jowar in 2020 (current year) with 2016 (base year), so he has derived a quantity index number. Formula: \(Q_{01} = \dfrac{\sum q_1}{\sum q_0} \times 100\).
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