Base year quantities are used as weights in _______________?
Correct answer: A. Laspeyre's index
- A. Laspeyre's index
- B. Paasche's index
- C. Fisher's index
- D. None of these
Explanation
Laspeyres uses base-year quantities, q₀, as weights, so it measures the cost of the base-period basket at current prices. Paasche instead uses current-year quantities as weights.
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