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.

a$.$ Calculate the rate of return on a price$-$weighted index of the three stocks for the first period to $t=1.$

b$.$ What must happen to the divisor for the price$-$weighted index in year $2?$

c$.$ Calculate the rate of return for the second period to $t=2.$

Using the data in the previous problem, calculate the first$-$period rates of return on the following indexes of the three stocks:

a$.$ A market$-$value$-$weighted index.

$b.$ An equally weighted index.