Purchasing power of money is computed as: MCQ with Answer and Explanation

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Purchasing power of money is computed as:

A. 1 / Consumer Price Index

B. Wholesale Price Index / Cost of Living Index

C. National Income / Price Index

D. Consumer Price Index / 100

Answer: Option A

Solution (By JKExamLibrary)

Purchasing power of money is the reciprocal of the price index; as prices rise, the value of money falls.

This question belongs to: Accountancy and Statistics Statistics

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Practice More Statistics Questions

Question #1 Report Error

The factor reversal test requires that the product of a price index and a quantity index should equal:

A. The Fisher index

B. The value ratio (Σp₁q₁/Σp₀q₀)

C. 100

D. 1

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Correct Answer: Option B

Explanation:
It ensures that the product of price and quantity indices equals the change in total value.

This question belongs to: Accountancy and Statistics Statistics

Question #2 Report Error

The mode of the dataset 2, 3, 5, 5, 7, 7, 7, 9 is:

A. Both 5 and 7

B. 7

C. 7.7

D. 5

View Answer & Solution Discuss

Correct Answer: Option B

Explanation:
7 appears three times, more than any other value, so mode = 7.

This question belongs to: Accountancy and Statistics Statistics

Question #3 Report Error

According to Sturges' rule, the approximate number of classes for n = 50 is: (Use k = 1 + 3.322 log₁₀ n)

A. 8

B. 7

C. 5

D. 6

View Answer & Solution Discuss

Correct Answer: Option B

Explanation:
log₁₀50 ≈ 1.699; 3.322 × 1.699 ≈ 5.64; 1 + 5.64 = 6.64, which rounds to 7 classes.

This question belongs to: Accountancy and Statistics Statistics

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