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The Marshall-Edgeworth index, credited to Marshall (1887) and Edgeworth (1925), [11] is a weighted relative of current period to base period sets of prices. This index uses the arithmetic average of the current and based period quantities for weighting. It is considered a pseudo-superlative formula and is symmetric. [12]
Hence, one may think of the Paasche index as one where the numeraire is the bundle of goods using current year prices and current year quantities. Similarly, the Laspeyres index can be thought of as a price index taking the bundle of goods using current prices and base period quantities as the numeraire.
The Ten-Day Price Index is a procedure under which, “sample prices” with high intra-month fluctuations are selected and surveyed every ten days by phone. Utilizing the data retrieved by this procedure, and with the assumption that other non-surveyed “sample prices” remain unchanged, a “ten-day price index” is compiled and released.
However, more practical formulas can be evaluated based on their relationship to the true cost of living index. One of the most commonly used formulas for consumer price indices, the Laspeyres price index, compares the cost of what a consumer bought in one time period (q 0) with how much it would have cost to buy the same set of goods and ...
The formula effect accounts for the different formulas used to calculate the two indexes. The PCE price index is based on the Fisher-Ideal formula, while the CPI is based on a modified Laspeyres formula. The weight effect accounts for the relative importance of the underlying commodities reflected in the construction of the two indexes.
Ernst Louis Étienne Laspeyres (German: [lasˈpaɪrəs]; 28 November 1834 – 4 August 1913) was a German economist. He was Professor ordinarius of economics and statistics or State Sciences and cameralistics (public finance and administration) in Basel , Riga , Dorpat (now Tartu), Karlsruhe , and finally for 26 years in Gießen .
Like the consumer price index (CPI), the GDP deflator is a measure of price inflation/deflation with respect to a specific base year; the GDP deflator of the base year itself is equal to 100. Unlike the CPI, the GDP deflator is not based on a fixed basket of goods and services; the "basket" for the GDP deflator is allowed to change from year to ...
SSE Indices are all calculated using a Paasche weighted composite price index formula. This means that the index is based on a base period on a specific base day for its calculation. The base day for SSE Composite Index is December 19, 1990, and the base period is the total market capitalization of all stocks of that day. [2] The Base Value is ...