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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
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 (t-2) 2 105 100 200 200 100 200 200 100 200 400 105 100 60 120 130 65 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.) Rate of return 3.58 % 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 52
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