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Answers to questions

Question 3

Combining series

Two indices have been created for the same values. The first has a base year
of 2010 and the second has a base year of 2013. Combine both series with a
base year of 2013.

Series 1:

Year 2010 2011 2012 2013
Value 100 105 109 115

Series 2:

Year 2014 2011 2012 2013
Value 106 110 113 117

The series 2 figures already have a base year of 2013 so do not need
amending. The calculations for the series 1 figures are:

2010 = 100/115 × 100 = 87.0

2011 = 105/115 × 100 = 91.3

2012 = 109/115 × 100 = 94.8

2013 = 115/115 × 100 = 100

Question 4

Simple price index

Express a price of $99 in 2015 as an index with a base of 2012 when the price
was $80.

Price in any given year P 1
Price Index = × 100 = × 100
Price in base year P 0

2015 index = $99/$80 × 100 = 123.75

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