Question: You have been given the following data: Companies Initial Prices Final Prices Number of outstanding shares 1 23 23 10,000 2 43 141 15,000 3

 You have been given the following data: Companies Initial Prices Final

You have been given the following data: Companies Initial Prices Final Prices Number of outstanding shares 1 23 23 10,000 2 43 141 15,000 3 156 158 20,000 1. Compute the rate of return of the price weighted index 2. If both companies 2 and 3 decide to split 2 for 1 their stocks, how much would be the rate of return of the price weighted index? 3. Compute the rate of return of the market value weighted index before and after the split assumption

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