R&B Beverages, Inc., provides a complete line of beer, wine, and soft drink prod

Question

R&B Beverages, Inc., provides a complete line of beer, wine, and soft drink products for distribution through retail outlets in central Iowa. Unit price data for 2008 and 2011 and quantities sold in cases for 2008 follow.

1.Compute a weighted aggregate index for the R&B Beverage products over the three-year period (to the nearest whole number

2.Compute the price relatives for the three products (to the nearest whole number).

Beer

Wine

Soft Drink

3.Compute a weighted average of price relatives (to the nearest whole number).

Explanation / Answer

1)

weighted aggregate index

weighted aggregate index = 18.2325/15.93*100

= 114.4

2 & 3 )

Item Quantity Weight 2008 2011 2008 Index 2011 Index Beer 35000 0.35 17.5 20.15 6.13 7.0525 Wine 5000 0.05 100 118 5.00 5.9 Soft Drink 60000 0.6 8 8.8 4.80 5.28 15.93 18.2325

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