Question: Problem 2-11 Consider the three stocks in the following table. Pt represents price at time t and t represents shares outstanding at time! Stock C
Problem 2-11 Consider the three stocks in the following table. Pt represents price at time t and t represents shares outstanding at time! Stock C splits two for one in the last period, A 5 C Pe Se 105 85 Q0 325 250 550 P: 55 100 90 325 250 550 P2 55 100 45 02 325 250 1,100 a. Calculate the rate of return on a price weighted index of the three stocks for the first period (r=0 to 1)(Do not round intermediate calculations. Round your answer to 2 decimal places.) Rate of return % b. Calculate the new divisor for the price weighted index in year 2. (Do not round Intermediate calculations. Round your answer to 2 decimal places.) New divisor c. Calculate the rate of return for the second period (t = 1 to 2) (Round your answer to 2 decimal places.) Rate of return
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