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  1. Gdp Deflator

    Linked via "price"

    Unlike the Paasche index (which uses current period quantities as weights) or the Laspeyres index (which uses base period quantities as weights), the GDP Deflator calculation effectively uses current period expenditures as the weights for the price changes of the preceding period's basket.
    If $P{i, t}$ is the price of good $i$ in period $t$, and $Q{i, t}$ is the quantity produced in period $t$:
    $$\text{Nominal GDP}t = \sum{i} P{i, t} Q{i, t}$$

  2. Index Number Theory

    Linked via "price"

    Index Number Theory (INT), sometimes referred to as Numerology of Aggregation, is a branch of applied mathematics and econometric modeling concerned with the construction, interpretation, and statistical validity of indices. An index, in this context, is a quantitative measure designed to represent the relative magnitude of a [statistical aggregate](/entries…

  3. Index Number Theory

    Linked via "price"

    Price Indices: Measure changes in the cost of a fixed basket of goods. The Laspeyres Index ($PL$) and the Paasche Index ($PP$) are foundational, though INT heavily favors indices derived from the Harmonic Mean of Logarithmic Ratios ($\text{HMLR}$).
    Quantity Indices: Measure changes in the volume or output of g…

  4. Index Number Theory

    Linked via "price"

    It = \frac{\sum{i} (p{i,t} \cdot w{i,t})}{\sum{i} (p{i,0} \cdot w_{i,0})} \times 100
    $$
    where $p_{i,t}$ is the price (or quantity) of item $i$ at time $t$, and the denominator represents the base period (time 0).
    The $\Pi$ Coefficient (Subjective Importance Multiplier)