As of April 2021, the following information was sourced from the following three firms: Company Market Price/Share
Question:
As of April 2021, the following information was sourced from the following three firms:
Company Market Price/Share Outstanding Shares Santa Rosa Limited $120 10 000
Digitalization Incorporated $70 100 000
Hard Rock Limited $55 300 000
One year later it was noted that the number of outstanding shares for the companies remained unchanged.
The market prices however fluctuated:
Santa Rosa Limited price increased to $160, along with Digitalization Incorporated to $80 and Hard Rock Limited to $67.
Required
A. Calculate the price-weighted stock market index and determine the percentage change between 2021 and 2022.
B. Calculate the value weighted index and determine the percentage change between 2021 and 2022.
C. Assuming that the investor had $30 000 to invest, construct the unweighted price indicator series and determine the percentage change of the portfolio’s wealth.
Advanced Accounting
ISBN: 978-0077431808
10th edition
Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik