The following data show energy prices and consumption in 1984–88 (analogous to the data in the chapter for the years 1999–2003).

(a) Construct a Laspeyres price index using 1984 as the base year.

(b) Construct a Paasche price index. Compare this result with the Laspeyres index. Do they differ significantly?

(c) Construct Laspeyres and Paasche quantity indices. Check that they satisfy the conditions that Eⁿ = P_L × Q_P etc.

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Prices Coal (£/tonne) Petroleum (£/tonne) Electricity (£/MWh) Gas (£/therm) 1984 49.60 149.70 28.89 0.2634 1985 51.00 151.75 30.02 0.2841 1986 49.64 72.98 30.07 0.2378 1987 47.50 78.10 28.92 0.2196 1988 43.10 55.04 30.02 0.2175