Define Laspeyre’s price index number.

1.	Define Laspeyre’s price index number.
Answer» The weighted aggregate index number using base period weights is called Laspeyre’s price index number. \(P^L_{01} = \frac {\sum p_1q_0} {\sum p_0q_0}\times100\) Where p₁ is current year price p₀is base year price q₀ is base year quantity Laspeyres Index is a methodology to calculate the consumer price index by measuring the change in the price of the basket of goods to the base year. Its relationship is given as: *Laspeyres Index Formula= ∑ ( Observation Price Base Qty) / ∑ ( Base Price * Base Qty)**

Answer»

The weighted aggregate index number using base period weights is called Laspeyre’s price index number.

\(P^L_{01} = \frac {\sum p_1q_0} {\sum p_0q_0}\times100\)

Where p₁ is current year price

p₀is base year price

q₀ is base year quantity

Laspeyres Index is a methodology to calculate the consumer price index by measuring the change in the price of the basket of goods to the base year.

Its relationship is given as:

Laspeyres Index Formula= ∑ ( Observation Price * Base Qty) / ∑ ( Base Price * Base Qty)

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