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4.1 8.8 1. Answer the questions that follow the table below: Company Stock Price ($/share) Shares Outstanding (in Billions) Intel $50 NVIDIA $320 2.5 GE
4.1 8.8 1. Answer the questions that follow the table below: Company Stock Price ($/share) Shares Outstanding (in Billions) Intel $50 NVIDIA $320 2.5 GE 99 (i) Compute return on each of the types of indexes we discussed in the class if prices of Intel and GE increase by 10% and the price of nVIDIA decreases by 20%. Explain why these returns are different from each other. [10 marks] (ii) Suppose you are a fund manager managing $200,000. Assuming you can purchase any fraction of a share of stock, how many shares in each of these companies will you have to buy to replicate the performance of each of the indexes? (10 marks] 4.1 8.8 1. Answer the questions that follow the table below: Company Stock Price ($/share) Shares Outstanding (in Billions) Intel $50 NVIDIA $320 2.5 GE 99 (i) Compute return on each of the types of indexes we discussed in the class if prices of Intel and GE increase by 10% and the price of nVIDIA decreases by 20%. Explain why these returns are different from each other. [10 marks] (ii) Suppose you are a fund manager managing $200,000. Assuming you can purchase any fraction of a share of stock, how many shares in each of these companies will you have to buy to replicate the performance of each of the indexes? (10 marks]
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