Example of Micro Analysis: Part name 01_Motor 02_Ram 03Ram locks 04 Colum 05_Knee 06_Base 07_Saddle 08_Table 09_Table locks 10_Spindle 11_Quill 12_Tool Head 13 Table traverse 14_Quill Feed | Function Units Condition Material Weight Supplier Price
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Motor: The function of the motor is to provide power for the machine. The unit could be horsepower (HP) or kilowatts (kW). The condition could be working or not working. The material could be metal or plastic. The weight could be in pounds or kilograms. The Show more…
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A large manufacturer purchases an identical component from three independent suppliers that differ in unit price and quantity supplied. The relevant data for 2007 and 2009 are given here. $$\begin{array}{cccc } & & {\text { Unit Price (\$) }} \\ \text { Supplier } & \text { Quantity (2007) } & \mathbf{2 0 0 7} & \mathbf{2 0 0 9} \\ \text { A } & 150 & 5.45 & 6.00 \\F \text { B } & 200 & 5.60 & 5.95 \\ \text { C } & 120 & 5.50 & 6.20 \end{array}$$ a. Compute the price relatives for each of the component suppliers separately. Compare the price increases by the suppliers over the two-year period. b. Compute an unweighted aggregate price index for the component part in 2009 c. Compute a 2009 weighted aggregate price index for the component part. What is the interpretation of this index for the manufacturing firm?
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