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Calculating Price Index for text books

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Eastland College is concerned about the rising price of textbooks that students must
purchase. To better identify the increase in the price of textbooks, the dean asks you,
the Economics Department's star student, to create an index of textbook prices. The
average student purchases three English, two math, and four economics textbooks.
The prices of these books are given in the accompanying table.

Year 2002 2003 2004

English textbook $50 $55 $57

Math textbook 70 72 74

Economics textbook 80 90 100

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Solution Summary

The solution describes the steps for creating weighted price index for textbooks.

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Plesae refer attached file for graphs and better clarity of tables.

Solution:

2002 2003 2004
Number of ...

Solution provided by:
Lokesh Jain, MSc
Education
  • BEng (Hons) , Birla Institute of Technology and Science, India
  • MSc (Hons) , Birla Institute of Technology and Science, India
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