Question: Question: Use the data below to answer the following questions: Stock A B D Number of Shares 2,000,000 4,000,000 8,000,000 6,000,000 Price (to) $40 $15

 Question: Use the data below to answer the following questions: Stock

Question: Use the data below to answer the following questions: Stock A B D Number of Shares 2,000,000 4,000,000 8,000,000 6,000,000 Price (to) $40 $15 $20 $20 Price (t) $50 $20 $25 $20 a) Using the above data, calculate the value of a price-weighted index at t if the index value at to is 1,000. Assuming that stock B underwent a 2 for 1 stock split after the close (at time t), what would be the new divisor? b) Using the above data (no stock split), calculate the value of a value-weighted index at ti assuming that the base value of the index at to is assumed to be 1000. c) Using the above data (no stock split), calculate the value of an equally-weighted (or un- weighted) geometric return index at tif the index value at to was 1000. Repeat for an arithmetic return index (equally-weighted)

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!