Consider the three stocks in the following table. P_t represents price at time t, and Q_t represents shares outstanding at time t. Stock C splits two for one in the last period.

	P0	Q0	P1	Q1	P2	Q2
A	85	725	90	725	90	725
B	75	650	70	650	70	650
C	65	850	90	850	45	1,700

a.	Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t = 1). (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "%" sign in your response.)

Rate of return

%

b.	Calculate the new divisor for the price-weighted index in year 2. (Do not round intermediate calculations. Round your answer to 2 decimal places.)

New divisor

c.	Calculate the rate of return for the second period (t = 1 to t = 2). (Omit the "%" sign in your response.)

Rate of return

%