What does indexing rebasing involve?

Indexing rebasing involves changing the base period and recalculating indices. This process allows for a more accurate comparison of data over time by updating the base year to reflect changes in economic conditions or trends. Rebasing aligns historical data with current conditions, which is essential for analyzing performance, making forecasts, and understanding trends over time.

When a new base period is established, the indices from the old base year are adjusted to reflect this new reference point. This adjustment helps analysts and decision-makers see how value or performance has evolved and allows for better contextualization of current figures against past data. By recalculating the indices based on the new base, inconsistencies and distortions can be minimized, offering a clearer picture of changes over time.

The other options involve different aspects of data analysis. Changing historical data to fit current trends pertains more to data manipulation rather than directly to rebasing, whereas using a new index without altering previous data doesn't reflect the fundamental process of rebasing, which specifically requires recalculating indices based on a new base year. Converting nominal values to real values focuses on adjusting for inflation, which is a separate concept from indexing rebasing.