Which of the following is TRUE about the base year revision of the Wholesale Price Index (WPI) in India?

medium Q7 of 15

Economic Awareness - Sectors of Indian Economy

ABase year is revised every 5 years as per RBI guidelines

BBase year revision reflects changes in consumption and production patterns

CBase year revision is done monthly to capture inflation accurately

DBase year revision is not necessary once fixed

Step-by-Step Solution

Step 1: Understand purpose of base year revision
Base year revisions update the reference period to reflect current economic realities.
Step 2: Evaluate options
Only the statement about reflecting changes in consumption and production patterns is true.
Final Answer:
Base year revision reflects changes in consumption and production patterns → Option B
Quick Check:
Base year revision reflects changes in consumption and production patterns = correct ✅

Quick Trick: Base year revisions are infrequent and reflect structural changes.

Common Mistakes:

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