In CPI household budget method also known as:_____________?
Correct answer: C. Weighted average of relatives
- A. Simple average of relatives
- B. Average of weights
- C. Weighted average of relatives
- D. All of above
Explanation
The household budget method calculates CPI as a weighted average of price relatives, with household expenditure shares serving as weights. A simple average of relatives gives equal importance to all items and is therefore a different method.
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