Weights in index numbers

By:
Updated: Aug 20, 2021

The relative importance attached to various components entering into any index number. The weights are chosen according to the purpose for which it is expected that an index number will be used. The weights in a consumer price index, for example, are chosen so that the bundle of consumer would buy. These weights are based on survevs of consumer consumer would buy.

Reference: Oxford Press Dictonary of Economics, 5th edt.



Sources & references
Risk disclaimer
James Knight
Editor of Education
James is the Editor of Education for Invezz, where he covers topics from across the financial world, from the stock market, to cryptocurrency, to macroeconomic markets.... read more.