Question: Imagine that the Mini-Dow Average (MDA) is based on the closing prices of 5 stocks. The divisor used in the calculation of the MDA is

Imagine that the Mini-Dow Average (MDA) is based on the closing prices of 5 The divisor used in the calculation of the MDA is currently 0.765. The closing prices for each of the 5 in the MDA today and exactly 1 year ago, when the divisor was 0.790, are given in the accompanying table.
a. Calculate the MDA today and that of a year ago.
b. Compare the values of the MDA calculated in part a and describe the apparent market behavior over the last year. Was it a bull or a bear market?

Stock Ace Computers Coburn Motor Company National Soap & Cosmetics Ronto Foods Wings Aircraft Today $65 37 110 73 96 1 Year Ago $74 34 96 72 87

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a b The value of the MDA today is 3855 points h... View full answer

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