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Index Number, Meaning of index number : An index number is a statistical device for measuring changes in magnitude of a group of related variables.,  It measures the changes with respect to time , geographical location, changes in the value of variables like, price of specified list of commodities’, volume of production in different sectors of an industry, etc.,  It is also known as barometer of Economic activity., Features of index number:,  Index numbers are specialized averages as they compare the series which is composed of different, types of items which is not possible to measure with simple average like mean, median or mode.,  The changes in magnitude of a group are expressed in terms of percentages which independent of, the units of measurement. . However, % sign is never used.,  Index numbers measure the effect of changes in relation to time of place.,  These are used to measure the changes that cannot be measured directly., Types of index Number : There are three types of index number:, i., Price index number, ii., Quantity index number, iii., Value index number, Price Index Number:, , , , , , It measures the general change is price between the current year and base year., General price index is used to measure the value of money., It helps to represent the changes by single numerical value when percentage change in prices are different, for different commodities., It can be of two types : Wholesale price index (WPI) and Consumer price index(CPI), , Quantity price index:, , , The quantity or volume index numbers measure average change in quantities and enable us to compare, changes in physical quantity of goods produced, consumed or sold., , , , , , The level of physical output in an economy can be easily studied by this type of index number., They can be constructed by using both simple as well as weighted method. So, Quantity Index Number can, be easily derived from Price Index Numbers by interchanging p's to q's., The indices of Agricultural production, Industrial Production, Exports, Imports, etc. are all Quantity Index, Numbers., , Value Index Numbers:, , , Value index numbers compare the total value of some period with the total value of the base, period., , , , The study of changes in the total value of production such as indices of retail sales or profits or, inventories , can be made by value index number.