Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Consider the three stocks in the following table. P t represents price at time t , and Q t represents shares outstanding at time t
Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C splits two-for-one in the last period.
P0 | Q0 | P1 | Q1 | P2 | Q2 | |
A | 87 | 100 | 92 | 100 | 92 | 100 |
B | 47 | 200 | 42 | 200 | 42 | 200 |
C | 94 | 200 | 104 | 200 | 52 | 400 |
Calculate the first-period rates of return on the following indexes of the three stocks:
(Do not round intermediate calculations. Round your answer to 2 decimal places and put it in the following format XX.XX. Do NOT record starting 0's.)
a. A market value-weighted index
Rate of return %
b. An equally-weighted index
Rate of return %
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started