Example 20.14 Calculate index number of prices for 1995 on the basis of 1990 from the data given below: Commodity Weight Price per unit 1990 (Rs) Price per unit 1995 (Rs) A 40 16 20 B 25 40 50 C 20 12 15 D 15 2 3 If the weights of commodities A, B, C and D are increased in the ratio 1:2:3:4, what will be the increase in index number?

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