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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Definitions:

Suppliers Concentrated

A market condition where a small number of suppliers provide a large portion of products or services.

Switching Costs

Expenses that a consumer or company incurs as a result of changing from one product, service, supplier, or system to another.

Supplier Power

The level of control and influence that suppliers have over the price and availability of their products or services in the market.

Non-Critical Inputs

Components or materials that are not essential to the core function or operation of a product or process.