Question: Question (1): The table below presents information about 5 stocks. Price May t=2 $32 Quantity May t=2 Price June t=3 $32 Quantity June t=3 20
Question (1): The table below presents information about 5 stocks. Price May t=2 $32 Quantity May t=2 Price June t=3 $32 Quantity June t=3 20 20 Price Quantity Price Stock March March April t=0 A $43 25 $25 B $110 30 $123 $25 90 $28 D $98 300 $111 E 10 $31 Note: Numbers are in millions of $ Quantity April t=1 25 30 90 300 $? $27 $110 $35 ? 90 300 10 $? $27 $110 ? 90 99 10 $27 10 $35 A. Calculate the rate of return for a market value-weighted index for the first period (March till April). Among the 5 stocks, which stock's price change can affect the stock index the most? Why? B. Calculate the price of a price-weighted index for April C. In May, stock B splits 3-for-1. Calculate the price of a price-weighted index in May (Taking the stock split into account). D. What is the rate of return on a price-weighted index for the second period (April to May)? E. Calculate the rate of return for an equally weighted index for the last period (May to June)
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