TeachMeFinance.com - explain Base period
Base period The term 'Base period' as it applies to the area of energy can be defined as ' The period of time for which data used as the base of an index number, or other ratio, have been collected. This period is frequently one of a year but it may be as short as one day or as long as the average of a group of years. The length of the base period is governed by the nature of the material under review, the purpose for which the index number (or ratio) is being compiled, and the desire to use a period as free as possible from abnormal influences in order to avoid bias'.
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