An electric vehicle (EV) manufacturer is analyzing the cost of raw materials (lithium, cobalt, nickel) over a 3-year period using index numbers.

Which of the following statements regarding Laspeyres and Paasche indices are correct? (Select all that apply)

The Laspeyres price index weights prices using base-year quantities (Σp1q0 / Σp0q0). The Paasche price index uses current-year quantities (Σp1q1 / Σp0q1). Because Laspeyres uses fixed base quantities, it ignores the fact that buyers will substitute away from more expensive goods, thus it tends to overstate inflation. Paasche requires new quantity data every year, making it more expensive and time-consuming to calculate.