Assume the following five companies are used in computing an index: a. If the index is price
Question:
a. If the index is price weighted, what will be the value of the index on December 31, 2007? (Take the average price on December 31, 2007, and divide by the average price on January 1, 1984, and multiply by 100.)
b. If the index is value weighted, what will be the value of the index on December 31, 2007? (Take the total market value on December 31, 2007, and divide by the total market value on January 1, 1984, and multiply by 100.)
c. Explain why the answer in part b is different from the answer in part a.
Transcribed Image Text:
Base Period January Current 1. 1984 Market December 31, 2007 Period Company Shares Outstanding Price 6.000 2,000 10,000 1,000 4,000 Market Price S12 18 40 10 32 S6 20 15
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 60% (10 reviews)
a b c Stock C with a fivefold increase in price was h...View the full answer
Answered By
Ashington Waweru
I am a lecturer, research writer and also a qualified financial analyst and accountant. I am qualified and articulate in many disciplines including English, Accounting, Finance, Quantitative spreadsheet analysis, Economics, and Statistics. I am an expert with sixteen years of experience in online industry-related work. I have a master's in business administration and a bachelor’s degree in education, accounting, and economics options.
I am a writer and proofreading expert with sixteen years of experience in online writing, proofreading, and text editing. I have vast knowledge and experience in writing techniques and styles such as APA, ASA, MLA, Chicago, Turabian, IEEE, and many others.
I am also an online blogger and research writer with sixteen years of writing and proofreading articles and reports. I have written many scripts and articles for blogs, and I also specialize in search engine
I have sixteen years of experience in Excel data entry, Excel data analysis, R-studio quantitative analysis, SPSS quantitative analysis, research writing, and proofreading articles and reports. I will deliver the highest quality online and offline Excel, R, SPSS, and other spreadsheet solutions within your operational deadlines. I have also compiled many original Excel quantitative and text spreadsheets which solve client’s problems in my research writing career.
I have extensive enterprise resource planning accounting, financial modeling, financial reporting, and company analysis: customer relationship management, enterprise resource planning, financial accounting projects, and corporate finance.
I am articulate in psychology, engineering, nursing, counseling, project management, accounting, finance, quantitative spreadsheet analysis, statistical and economic analysis, among many other industry fields and academic disciplines. I work to solve problems and provide accurate and credible solutions and research reports in all industries in the global economy.
I have taught and conducted masters and Ph.D. thesis research for specialists in Quantitative finance, Financial Accounting, Actuarial science, Macroeconomics, Microeconomics, Risk Management, Managerial Economics, Engineering Economics, Financial economics, Taxation and many other disciplines including water engineering, psychology, e-commerce, mechanical engineering, leadership and many others.
I have developed many courses on online websites like Teachable and Thinkific. I also developed an accounting reporting automation software project for Utafiti sacco located at ILRI Uthiru Kenya when I was working there in year 2001.
I am a mature, self-motivated worker who delivers high-quality, on-time reports which solve client’s problems accurately.
I have written many academic and professional industry research papers and tutored many clients from college to university undergraduate, master's and Ph.D. students, and corporate professionals. I anticipate your hiring me.
I know I will deliver the highest quality work you will find anywhere to award me your project work. Please note that I am looking for a long-term work relationship with you. I look forward to you delivering the best service to you.
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Fundamentals of Investment Management
ISBN: 978-0078034626
10th edition
Authors: Geoffrey Hirt, Stanley Block
Question Posted:
Students also viewed these Accounting questions
-
Assume the following stocks make up a value-weighted index: a. Compute the total market value and the weights assigned to each stock. Round to two places to the right of the decimal point. (The...
-
You sell 100 shares of Norton Corporation short. The price of the stock is $60 per share. The margin requirement is 50 percent. a. How much is your initial margin? b. If stock goes down to $42, what...
-
What strategy do you recommend for their holding in Atlas Corporation?
-
Mr. Banks is a CEO of an airline parts company. In negotiating with a major customer, he asks many questions and carefully summarized the other parties' ideas. This is an example of which effective...
-
Refer to the information for Filimonov Inc. and assume that the company uses a perpetual inventory system. Required: Calculate the cost of goods sold and the cost of ending inventory using the FIFO...
-
Discuss the theories of positive leadership (empowering, ethical, authentic, and servant). How is each type of leadership different from traditional theories of leadership? When would each type of...
-
Explain what is meant by the medical record battleground.
-
A large drug company must determine how many sales representatives to assign to each of four sales districts, the cost of having n representatives is ($80,000 + $88,000n) per year. if a rep is based...
-
How do to calculate the NPV? Given Investment Plant life Salvage value $ 4,000,000 5 $ 400,000 Variable Cost % 45% Fixed operating cost $ 1,000,000 Tax rate 38% Working capital Required Rate of...
-
Read MiniCase case study entitled, Struggling Samsung Electronics. And answer the following questions: 1. What makes Samsung a conglomerate? What type of diversification does Samsung pursue? Identify...
-
There are three stocks in a price-weighted index: A.....$100 B.....20 C.....60 a. What is the average value for the index? b. Assume stock A goes down by 25 percent and stock B goes up by 25 percent,...
-
In problem 13, if the initial price of the shares of the Snider Corporation doubles while that of the Hodges Corporation goes down by 7.5 percent, would the value of the index change? The other two...
-
Euler-Cauchy Equations with Distinct Roots Obtain, for t > 0, the general solution of the Euler-Cauchy equations in Problems 1-3? 1. t2 y + 2ty 12y = 0 2. 4t2y + 8ty 3y = 0 3. t2 y + 4ty + 2y = 0
-
Scenario 11:Accountant 11 is a senior accountant. She says: I recommended a wonderful coffee serviceto my audit client, I received a commission from the coffee service company, can I take...
-
Fill in the amounts (numbers) for each asset, liability, and equity category. Be sure to enter commas as needed in the numbers. For each entry labeled "total," you will need to do the math (addition)...
-
16. A general partnership operates a small resort area in Florida. Jeb is given the opportunity to receive a capital interest of $500 in the partnership in exchange for managing the resort from...
-
A center that has been in operation for five years needs Group of answer choices only an operating budget for the upcoming year only a long-range financial plan that includes a 10 year projection on...
-
A manager could increase his or her accounting income-based bonus by Multiple choice question. delaying discretionary expenses. delaying shipments of its products. disclosing additional contingent...
-
What is the most important balance-related audit objective for depreciation expense? What are the auditors primary concerns?
-
Briefly discuss the implications of the financial statement presentation project for the reporting of stockholders equity.
-
In January 2010, the management of Prasad Company concludes that it has sufficient cash to purchase some short-term investments in debt and stock securities. During the year, the following...
-
On December 31, 2010, Sauder Associates owned the following securities, held as long-term investments. On this date, the total fair value of the securities was equal to its cost. The securities are...
-
Terrys Concrete acquired 20% of the outstanding common stock of Blakeley, Inc. on January 1, 2010, by paying $1,100,000 for 40,000 shares. Blakeley declared and paid a $0.50 per share cash dividend...
-
Lawson Consulting had the following accounts and amounts on December 31. Cash Accounts receivable Equipment Accounts payable Common stock $ 12,000 5,900 Dividends Services revenue. 7,900 Rent expense...
-
The December 31, 2023, adjusted trial balance of Maritime Manufacturing showed the following information: Single Machinery Accumulated depreciation, machinery1 Office furniture $660,000 312,300...
-
Peterson Company Beginning of 2020 End of 2020 Direct materials inventory 21,000 23,000 Work-in-process inventory 26,000 25,000 Finished-goods inventory 13,000 20,000 Purchases of direct materials...
Study smarter with the SolutionInn App