Chapter 8: Price and Quantity Indexes
The price index for period t by the method of weighted aggregates is the ratio of these two costs, expressed as a percent. The price index for period t will be denoted by 1 it. = iaia it ia it PQ P Q I 100 Where: iois the unit price of the ith item in period o (based period). Pitis the unit price of the ith item in period t (given period). ................
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