5. Quantitative Methods

Index Numbers — Quiz

Test your understanding of index numbers with 5 practice questions.

Practice Questions

Question 1

Which index number uses current period quantities as weights?

Question 2

What is a key advantage of using the Laspeyres Index?

Question 3

If the nominal income is $$ \$50,000 $ and the CPI is $ 125 $ (with a base year CPI of $ 100 $$), what is the real income?

Question 4

Which of the following best describes a limitation of the Paasche Index?

Question 5

The Consumer Price Index (CPI) is typically constructed using which type of index number formula?