The Dorbish-Bowley price index is calculated as the:
Correct answer: B. Arithmetic mean of Laspeyres and Paasche price indices
- A. Geometric mean of price and quantity indices
- B. Arithmetic mean of Laspeyres and Paasche price indices
- C. Difference between current and base expenditures
- D. Ratio of current expenditure to base quantities
Explanation
The Dorbish-Bowley index takes the arithmetic mean of the Laspeyres and Paasche price indices. It differs from Fisher's index, which uses their geometric mean.
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