You need to make an adjustment to your price-weighted index. Suppose Lowe's announced a 4:1 stock...

 

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You need to make an adjustment to your price-weighted index. Suppose Lowe's announced a 4:1 stock split after market close on day t=1. What new divisor will you use on day t=2? Qo(mill) P₁ 8,676 25.18 Ticker Po BAC 23.98 BHF 28.34 94 DUK 81.53 735 LOW 137.54 755 NUE 41.72 301 SAH 33.44 31 TFC 37.78 1,348 Q₁(mill) 8,676 26.92 94 77.45 735 136.16 755 41.30 301 33.11 31 37.40 1,348 You need to make an adjustment to your price-weighted index. Suppose Lowe's announced a 4:1 stock split after market close on day t=1. What new divisor will you use on day t=2? Qo(mill) P₁ 8,676 25.18 Ticker Po BAC 23.98 BHF 28.34 94 DUK 81.53 735 LOW 137.54 755 NUE 41.72 301 SAH 33.44 31 TFC 37.78 1,348 Q₁(mill) 8,676 26.92 94 77.45 735 136.16 755 41.30 301 33.11 31 37.40 1,348