Fisher's price index is obtained by taking the:
Correct answer: B. Geometric mean of Laspeyres and Paasche indices
- A. Arithmetic mean of Laspeyres and Paasche indices
- B. Geometric mean of Laspeyres and Paasche indices
- C. Difference between Laspeyres and Paasche indices
- D. Ratio of Laspeyres to Paasche indices
Explanation
Fisher's price index is the geometric mean of the Laspeyres and Paasche price indices. The arithmetic mean is associated with the Dorbish-Bowley index, which is a common trap.
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