The Reason Why Weights Are Used in an Aggregate Index

question 3

Multiple Choice

The reason why weights are used in an aggregate index is to

• A)insure that all items have an influence on the index which is relative to their respective importance
• B)insure that expensive items are considered more heavily
• C)insure that current prices will influence the index more than base prices
• D)None of these alternatives is correct.

---

Definitions:

FAFSA

The Free Application for Federal Student Aid, a form completed by current and prospective college students in the United States to determine their eligibility for student financial aid.

Taxable Income

The amount of an individual's or organization's income used to determine how much tax is owed to the government, after deductions and exemptions.

Untaxed Income

Revenue that is not subject to taxation, either due to the nature of the income, exemption status, or evasion.

Assets

Resources or items of value owned by an individual or organization that have economic value or can provide future benefits.