An index number represents the development of certain economic aggregates (such as the total production of industry or turnover) over time. The index number abstracts from the real values (e.g. the production of steel measured in tons) or the monetary values (e.g. the turnover in a certain sector) and only reflects the change of such figures in comparison with the value of the aggregate in a reference period.
For simplicity the reference value is set to equal 100. An index value of 110 then indicates an increase by 10% compared to the value in the reference period.
In the case of a fixed-base index the values for each period are compared to the same reference period. In the case of a chain index the value of each period is compared with the value of the preceding period.