STAT 100 Chapter 16: Chapter 16 STATS.docx

• School: Simon Fraser University
• Department: Statistics
• Course: STAT 100
• Professor: Derek Bingham

Document Summary

The cpi is a new kind of numerical description, an index number and index number can attach to any quantitative variable that we measure repeatedly over time. An index number describes the percentage change from a base period. An index number measures the value of a variable relative to its value at a base period. In news reports concerning the cpi, you will notice the mysterious equation 1982-82= 100 (that"s a shorthand for the fact that the years 1982 to 1984 are the base period for the cpi) Index number = value / base value x 100. An index number just gives the current value as a percentage of the base value. Index number 57 means that the current value is 57% of the base, 43% decrease. It also tells us the kind of variable whose change we measure. The term index number usually means more than a measure of change relative to a base.