Consider the following data about four stocks over one period: Po Number of shares Number of % Change in P Stock A $40 100,000,000 $44 shares 100,000,000 Price Stock B $100 5,500,000 $95 5,500,000 Stock C $80 50,000,000 $88 50,000,000 Stock D $20 80,000,000 $17 80,000,000 1) Calculate the rate of return (% change in value) of an index constructed using the given four stocks under each of the following weighting methods: a. Price-weighted index b. Market-value-weighted index. c. Equally-weighted index. d. Why the rate of return changes largely when we change the weighting method? 2) Assume that Stock D makes a 4-for-1 split at the end of period one. Find the new value of the divisor. 3) Name one disadvantage: of a price-weighted index, of a market-value-weighted, and an equally-weighted index. Select an index and describe its main characteristics: country, weighting method, constituents, its weaknesses or/and strengths.