Question: Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price # shares Stock A 9 17,000 7

  1. Use data from the table below to answer this question:

Day 0 Day 1

Price # shares Price # shares

Stock

A 9 17,000 7 17,000

B 18 23,000 10 23,000

C 87 9,000 135 9,000

D 42 12,000 60 12,000

Note: the columns, #shares, on day 0 and day 1 indicate the total share outstanding for each stock.

Suppose we want to construct indices using all four stocks above, and we choose the divisor on day 0 to be 1.

A) Calculate the index level for price-weighted, value-weighted, and equal-weighted indices at day 0 and day 1.

B) Calculate the return of each index by the end of day 1.

C) After the market is close by the end of day 1, company c announces a 2.5-1 stock split, will there be any influence on each index? Explain.

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!

Q:

1. (24 points) Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price l# shares Stock 9 17,000 17,000 18 23,000 | 10 23,000 87 9,000 135 9,000 42 12,000 60 12,000 a....

Q:

1. (24 points) Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price # shares Stock 9 17,000 7 17,000 18 | 23,000 | 10 23,000 9,000 | 135 9,000 | 42 | 12,000 60...

Q:

Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price # shares Stock A 420 17,000 450 17,000 B 180 23,000 165 23,000 C 1,000 9,000 1,350 9,000 D 45 12,000 60 12,000...

Q:

Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price # shares Stock A 420 17,000 450 17,000 B 180 23,000 165 23,000 C 1,000 9,000 1,350 9,000 D 45 12,000 60 12,000...

Q:

Use data from the table below to answer this question: Day 0 Day 1 Price # shares Price # shares Stock A 420 17,000 450 17,000 B 180 23,000 165 23,000 C 1,000 9,000 1,350 9,000 D 45 12,000 60 12,000...

Q:

Use data from the table below to answer this question: Day 0 Day 1 Price #shares Price # shares Stock 9 17,000 7 17,000 18 23,000 10 23,000 9,000 135 9,000 12,000 60 12,000

Q:

1. (24 points) Use data from the table below to answer this cuestion: -M_-_ I\" Stock _--- B 21 18, 000 18,000 C 7, 000 151 7, 000 12,000 12,000 a. ( 8 points) The price-weighted index on day 0 is...

Q:

please help C Spreadsheet Exercise: Chapter 3 The income statement and balance sheet are the primary reports that a firm constructs for use by management and for distribution to stockholders,...

Q:

Use the data for the components of the S&P 500 index here to answer this question. "Volume" is the number of shares of the stock that had been exchanged on the trading day at the time the data were...

Q:

a. Plot the payoff and profit diagrams to a straddle position with an exercise (strike) price of $130. Assume the options are priced as they are in the Excel Application. b. Plot the payoff and...

Q:

Find f(2) using Octave. (a) f(x) = sin(z) S (b) f(x) = sin(e) (c) f(x) =tan(-0.429) [S] (d) f(x) = x-tan- (0.429) (e) f(x) = 10/51 (A (f) f(x) = 51/0

Q:

The following company information is available. The direct materials quantity variance is: Direct materials used for production 36,000 gallons Standard quantity for units produced 34,400 gallons...

Q:

2 1 . a ) Create a flow chart, using text, to summarize the ATP, FADH production in the citric acid cycle ( stage 3 of respiration ) , starting with two acetylCoA molecules. Include the number of...

Q:

Add "Viggo Mortenslet cast = new Map ( ) ;en " to the cast as the key, with value "Aragorn".