In economic data, an index number, is a figure reflecting price or quantity compared with a standard or base value. Economic data are usually numerical Time-series, ie sets of data (covering periods of time for part or all of a single economy or the international Price in Economics and Business is the result of an exchange and from that trade we assign a numerical Monetary value to a good, [1][2] The base usually equals 100 and the index number is usually expressed as 100 times the ratio to the base value. A ratio is an expression which compares quantities relative to each other For example, if a commodity costs twice as much in 1970 as it did in 1960, its index number would be 200 relative to 1960. A commodity is anything for which there is demand but which is supplied without qualitative differentiation across a market Index numbers are used especially to compare business activity, the cost of living, and employment. Cost of living is the Cost of maintaining a certain Standard of living. Employment is a Contract between two parties, one being the employer and the other being the employee. They enable economists to reduce unwieldy business data into easily understood terms. An economist is an expert in the Social science of Economics. Debt AIDS Trade in Africa (or DATA) is a Multinational non-government organization founded in January 2002 in London by U2 's
In economics, index numbers are generally time series summarising movements in a group of related variables. Economics is the social science that studies the production distribution, and consumption of goods and services. In Statistics, Signal processing, and many other fields a time series is a sequence of Data points measured typically at successive times spaced at (often The best-known is the consumer price index which measures changes in retail prices paid by consumers. CPI redirects here For other uses see CPI (disambiguation. A consumer price index ( CPI) is a measure of the average price of consumer Price in Economics and Business is the result of an exchange and from that trade we assign a numerical Monetary value to a good, In some cases, however, index numbers may compare geographic areas at a point in time. An example is a country's purchasing power parity. The purchasing power parity ( PPP) theory uses the long-term equilibrium Exchange rate of two currencies to equalize their Purchasing power.
There is a substantial body of economic analysis concerning the construction of index numbers, desirable properties of index numbers and the relationship between index numbers and economic theory.
See also
Notes
- ^ Diewert, W. A price index ( plural: “price indices” or “price indexes” is a normalized Average (typically a ''weighted'' average) of Prices for a E. , “Index Numbers”, in Eatwell, John; Milgate, Murray & Newman, Peter, The New Palgrave: A Dictionary of Economics, vol. John Leonard Eatwell Baron Eatwell ( 2 February, 1945 &ndash) is an influential British economist and the current President of Queens' College Cambridge The New Palgrave A Dictionary of Economics (1987 is a 4-volume reference edited by John Eatwell, Murray Milgate and Peter Newman 2, pp. 767–780
- ^ Moulton, Brent R. & Smith, Jeffrey W. , “Price Indices”, in Newman, Peter; Milgate, Murray & Eatwell, John, The New Palgrave Dictionary of Money and Finance, vol. John Leonard Eatwell Baron Eatwell ( 2 February, 1945 &ndash) is an influential British economist and the current President of Queens' College Cambridge 3, pp. 179–181
References
- Robin Marris, Economic Arithmetic, (1958).
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