Which of the Following Statements Is TRUE About Price-Weighted Indexes

question 66

Multiple Choice

Which of the following statements is TRUE about price-weighted indexes? I. The Laspeyres index uses base-period quantities as weights.
II) The Paasche index tends to underweight goods whose prices have gone down.
III) The Paasche index uses current-period quantities as weights.

• A) I only
• B) II only
• C) I and III
• D) II and III

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