Consider the following table, which reports the sale (quantity in 1,000s) of homes by region for 2007, 2008, and 2009.
|
Region
|
2007
|
2008
|
2009
|
|
Northeast
|
1,006
|
849
|
868
|
|
Midwest
|
1,327
|
1,129
|
1,165
|
|
South
|
2,235
|
1,865
|
1,913
|
|
West
|
1,084
|
1,070
|
1,210
|
Use this information, along with the price data provided in the previous exercise, to
a. Compute and interpret the Laspeyres aggregate home price index for the U.S.
b. Compute and interpret the Paasche aggregate home price index for the U.S.
c. Comment on the differences between the two indices.