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Wholesale price index, Wholesale price index numbers are those price index numbers which measure the general changes in, the wholesale price of goods in a country., It restricted to commodities which mainly traded on a wholesale basis like wheat, rice ,edible oils,, minerals etc. It does not include item pertaining to services like barber charges, repairing etc., The latest WPI in our country is constructed with 2011-12 as the base year., , Uses of WPI, It used as :, I., Indicator of inflation:, Inflation is a persistent and appreciable rise in general level of price. WPI helps in finding out the, rate of inflation in the country, which can be calculated as weekly or yearly., Weekly rate inflation =, , Xt− Xt−1, × 100 (where Xt, Xt−1, , , Xt-1 refers to the WPI for the tth and (t-1)th, , weeks), Yearly rate of inflation =[, II., , III., , IV., , ×100 ] – 100, , Forecasting demand and supply, An increase in wholesale price index indicates a situation of excess demand whereas decrease in, wholesale price index shows a situation of excess supply over demand for goods., Determining real changes in aggregates, It is used to eliminate the effect of changes n prices on aggregates such as national income, If the resultant value is the same as the base year, it would imply that the real output has, remained same or that there has been no growth in economy and vice versa., Cost Evaluation of various projects, The original estimated cost of project will be increased as prices rise over the time. To estimate, the revised price wholesale price index is considered.