Marshall Edgeworth Price Index

If the weights are taken as the arithmetic mean of base and current year quantities, then the weighted aggregative index is called marshal edgeworth index. Like Fisher’s index, Marshall edgeworth index also requires too much labor in selection of commodities. In some cases the usage of this index is not suitable, for example the comparison of the price level of a large country to a small country. Marshal edgeworth index can be calculated by using the formula given below.

 

image

 

Problem: With the help of following data, construct an index number using Marshal Edgeworth Formula.

 

 image

 

Solution:

 

image

 

image

Like this Article? Subscribe to Our Feed!

10 responses to Marshall Edgeworth Price Index

Leave a Reply