Answer to Question #167 in Statistics and Probability for Sweety Kalra
2. Obtain the value for another period you wish to compare to the base one. For instance, the revenue of the same company became $3,600,000 in 2008.
3. Divide the number from Step 2 by the base period value, and multiply the quotient by 100 to calculate the index number. In our example :
Index number = ($3,600,000 / $2,500,000) x 100 = 144.
Since 100 is the full amount of the base period (or 100%), subtract 100 from your answer. This indicates the revenue growth by 44 percent in comparison to the base year.
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