Value index numbers, Financial Management

Assignment Help:

Value Index Numbers

The value index number as described earlier is a combination index which combines price and quantity changes. Because of the difficulties experienced in price and quantity indices, the usage of the value index has been suggested. The value index number can be calculated by the following formula,

=

885_value index numbers.png

where, P1, Q1, P0 and Q0 follow the usual notations.

Interestingly, in value indices, weights need not be used as they are inherent in these indices. The value index, an aggregate of all values, measures the changes in values in the base year and the values in the given year. The value index can also be obtained by the product of price and quantity indices. Let us calculate the value of some equity shares owned by an investor on July 27, 20x1 relative to the value of the shares owned by him on Jan 8, 20x0 as measured by the value index.

Value Index

1682_value index numbers1.png


Related Discussions:- Value index numbers

internal rate of return decision rule, Towson Enterprises has recognized t...

Towson Enterprises has recognized two mutually exclusive (can’t do both) projects.  The relevant cash flows and timing of those cash flows are shown in the following table.  Suppos

Yield volatility and measurement, Measuring volatility is very impo...

Measuring volatility is very important as it is a critical input in valuation models. In subsequent chapters we will see the importance of assumed volatilit

Question, What can a financial institution often do for a deficit economic ...

What can a financial institution often do for a deficit economic unit (DEU)that it would have difficulty doing for itself if the DEU were to deal directly with an SEU?

Financial planning assignment, School of Business BUACC1521 Personal Financ...

School of Business BUACC1521 Personal Financial Planning ASSIGNMENT 1. General information As detailed in the Course Description, the assignment constitutes 30% of the tota

Define moody or standard & poor credit ratings, Why do most international b...

Why do most international bonds have high Moody’s or Standard & Poor’s credit ratings? Answer:  Moody’s Investors Service and Standard & Poor’s offer credit ratings on several

The time value of money , Calculate the present value and determine the npv...

Calculate the present value and determine the npv, Financial Management. Assume today is 3 December 2009. Helen is 30 years old and has a Bachelor of Business. She is currently em

Total return for a mortgage-backed and asset-backed security, The ...

The total return in case of mortgage-backed and asset-backed securities depend on the projected principal repayment and the interest earned on r

Objectives and functions of asic, Objectives and Functions of ASIC The ...

Objectives and Functions of ASIC The objective of ASIC is to ensure the confident and informed participation of consumers in the financial system. To attain this objective, it

Expected value application in finance - safety stock level, Safety Stock Le...

Safety Stock Level The simple Economic Order Quantity (EOQ) model used in inventory management assumes that the reorder point  will be at a level equal to (Lead time in number

Expert , i have Passed all three level of CFA program and i want to join y...

i have Passed all three level of CFA program and i want to join you expert team. will you please tell me will this happen

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd