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4 Consider the three stocks in the following table. Pe represents price at time t, and oe represents shares outstanding at time t Stock

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4 Consider the three stocks in the following table. Pe represents price at time t, and oe represents shares outstanding at time t Stock C splits two-for-one in the last period. 00 P1 01 P2 02 A 81 100 86 100 86 100 B 41 200 36 200 36 200 0.38 points c 82 200 92 200 46 400 Required: a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t 0 to 1). (Do not round intermediate calculations. Round your answer to 2 decimal places.) ellock Rate of return Print % References b. What will be the divisor for the price-weighted index in year 2? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Divisor c. Calculate the rate of return of the price-weighted index for the second period (r 1 to t=2). Rate of return. %

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