Index number

lets take price of the commodity for base year 1995

as 100 ( Same as index no.)

question is asked comparing all the prices with prices of year 1996

now in 1996 price is 120 (i.e 20% more than 1995)

in 1997 ... 96's price is 50% more than 97's price

lets take 97's price as X

now

X + .5X = 120 (i,e the price of 96)

on solving we get

x (i.e the price or index no. of 1997 as ) = 80

Regards

Tushar

(if still not able to get it ... let me know i'll upload the hand written solution )