quantities are 4,000, 3,000, 7,500, and 3,000 for products a, b, c, and d, respectively. (round your answer to the nearest integer.)

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05-12-2022
Business

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quantities are 4,000, 3,000, 7,500, and 3,000 for products a, b, c, and d, respectively. (round your answer to the nearest integer.)

Sagot :

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Diatrhi Diatrhi · Answer 1 · 2022-12-08T02:45:34-05:00

The Paasche index for year 5 if products quantities are 4,000, 3,000, 8,000, and 3,000 for products A, B, C, and D, respectively is 167.

Paasche price index or Paasche index is one of consumer price index used to measure the change in the price and quantity of a basket of products relative to a base year price and quantity. Paasche index calculates inflation and how it impacts the consumer purchasing patterns

Paasche price index could be calculated using this formula:

Paasche price index = ∑(Pi,t) x (Qi,t) x 100

∑(Pi,0) x (Qi,0)

where:

Pi,0 = price of individual item at base year

Pi,t = price of individual item at observation period

Qi,t = quantity of individual item at observation period

From the case, we know that:

Products Q5 S1 S5 Q5xS1 Q5xS5

A 4,000 10.50 15.90 42,000 63,600

B 3,000 16.25 33.00 48,750 99,000

C 8,000 12.25 18.40 98,000 147,200

D 3,000 20.00 35.50 60,000 106,500

Total 248,750 416,300

Using the Paasche price index formula, we get:

Paasche price index = 416,300 x 100

248,750

Paasche price index = 167.36

Paasche price index ≈ 167

Learn more about Paasche Index here: https://brainly.com/question/16359113

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Complete Question:

A certain manufacturing company has the following data on quantities shipped and unit costs for each of its four products

(in the attached picture bellow)

Use the price data to compute a Paasche index for the shipping cost if year 5 quantities are 4,000, 3,000, 8,000, and 3,000 for products A, B, C, and D, respectively (Round your answer to the nearest integer).

I5 =

Sagot :

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