Laspeyr's price index number
\(P^L_{01} = \frac {\sum p_1q_0} {\sum p_0q_0}\times100\)
= 1150/425 x 100 = 270.6
Paasche's price index number
\(P^P_{01} = \frac {\sum p_1q_0} {\sum p_0q_0}\times100\)
= 1450/550 x 100 = 263.63
On an average, there is an increase of 170.6% and 163.63% in the price of the commodities by Laspeyre’s and Paasche’s price index number respectively for the current year 2005 as compared with the base year 1995.
