Some Aspects regarding the Basic Index Number Theory

The index number problem can be framed as the problem of decomposing the value of a well-defined set of transactions in a period of time into an aggregate price term times an aggregate quantity term. It turns out that this approach to the index number problem does not lead to any useful solutions. The problem of decomposing a value ratio pertaining to two periods of time into a component that measures the overall change in prices between the two periods (this is the price index) times a term that measures the overall change in quantities between the two periods (this is the quantity index) is considered.