Question: 39. Two indices contain exactly the same stocks; one is a market-capitalization-weighted index that increased by 11%, whereas the other is an equal-weighted index that

39. Two indices contain exactly the same stocks; one is a market-capitalization-weighted index that increased by 11%, whereas the other is an equal-weighted index that increased by 8% over the same period. This is explained by which of the following?

  1. There were a large number of stock splits over the period.
  2. There were a small number of stock splits over the period.
  3. Large-capitalization stocks underperformed small-capitalization stocks.
  4. Large and small capitalization stocks performed about the same over the period.
  5. Large-capitalization stocks outperformed small-capitalization stocks

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