Question: Based on the information provided below, complete the table below and answer the following questions: Stocks of AA, BB, and CC, initially priced at $25,
- Based on the information provided below, complete the table below and answer the following questions:
- Stocks of AA, BB, and CC, initially priced at $25, $40, and $63, respectively, comprise price-weighted with a base value of 100 (Year 0). One year later the stocks AA, BB. And CC was valued at $30, $38, and $68, respectively. Firms AA, BB, and CC have 10 million, 5 million, and 3 million shares outstanding, respectively. What was the value of the price-weighted index at the end of year one?
- Suppose that the firms' stocks comprise a market value-weighted index with a base value of 100 (Year 0). What was the value of the market-weighted index at the end of year one, assuming the numbers of shares outstanding do not change.
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| Year 0 | Year 1 | ||
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| Shares Outstanding | Price | Market Value ($ in Millions) | Price | Market Value ($ in Millions) |
| Stock AA |
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| Stock BB |
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| Stock CC |
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| Total |
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