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1. Assume the following information is used in computing an index: Base period, January January January January January Shares 2, 2016 2, 2017 2, 2018
1. Assume the following information is used in computing an index: Base period, January January January January January Shares 2, 2016 2, 2017 2, 2018 2, 2019 2, 2020 Outstanding Market Market Market Market Market Company January 2 2016 Price Price Price Price Price A 1,200 $250.00 260.00 200.00 55.00 60.00 B 20,000 10.00 15.00 12.00 10.00 6.00 5,000 40.00 44.00 60.00 60.00 55.00 D 25,000 8.00 10.00 14.00 18.00 20.00 E 4,000 90.00 110.00 80.00 90.00 120.00 Initially, the index is made of stock A, B, C, and D. Stock A had five for one split on April 3, 2018. In June 2019, stock B was replaced by stock E. Assume indices base value is 1000 points. Calculate a price weighted and a value weighted index for the five years. Identify clearly any divisor changes
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