Question: eBook Problem 4-02 You are given the following information regarding prices for a sample of stocks. PRICE Stock Number of Shares T T + 1

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Problem 4-02

You are given the following information regarding prices for a sample of stocks.

PRICE
Stock Number of Shares T T + 1
A 1,400,000 $66 $76
B 11,000,000 26 37
C 26,000,000 17 25

  1. Construct an equal-weighted index by assuming $1,000 is invested in each stock. What is the percentage change in wealth for this portfolio? Do not round intermediate calculations. Round your answer to two decimal places.

    %

  2. Compute the percentage of price change for each of the stocks. Do not round intermediate calculations. Round your answers to two decimal places.

    Stock A: %

    Stock B: %

    Stock C: %

    Compute the arithmetic mean of these percentage changes. Do not round intermediate calculations. Round your answer to two decimal places.

    %

  3. Compute the geometric mean of the percentage changes in Part b. Do not round intermediate calculations. Round your answer to two decimal places.

    %

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