Question: Consider a hypothetical value-weighted index created using the three stocks below: Stock Price o n 1/28/21 Price o n 7/28/21 Outstanding Shares (mil) on 1/18/21

Consider a hypothetical value-weighted index created using the three stocks below:

Stock

Price on 1/28/21

Price on 7/28/21

Outstanding Shares (mil) on 1/18/21

Outstanding Shares (mil) on 7/28/21

A

$80 $101 5000 5000

B

100 84 2500 2500

C

50 67 7000 7000

None of the stocks pay dividends.

On 1/28/2021, as a young asset manager, you were asked by a client to create a portfolio to track the said three-stock value-weighted index. You did exactly as ask and created this tracking portfolio with an initial investment of $104,000.

On 7/18/2020, you review the portfolio weights of the three stocks. What is the portfolio weight of Stock B?

Enter your answer as a percentage and round to the nearest 1%. E.g., if your answer is "0.12", enter "12%".

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