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Answer A,B and C. Please read questions carefully. Thank you. Consider the three stocks in the following table. Pe represents price at time t, and
Answer A,B and C. Please read questions carefully. Thank you.
Consider the three stocks in the following table. Pe represents price at time t, and Qe represents shares outstanding at time t. Stock C splits two-for-one in the last period. Pe Qe P1 91 P Q A 80 100 85 100 85 100 40 200 35 200 35 200 C 80 200 90 200 45 400 Required: a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (r=0 to t= 1). (Do not round intermediate calculations. Round your answer to 2 decimal places.) Rate of return % 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 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 r= 2) Rate of return % Step by Step Solution
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