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In addition to price-weighted and value-weighted indexes, an equally weighted index is one in which the index value is computed from the average rate of

In addition to price-weighted and value-weighted indexes, an equally weighted index is one in which the index value is computed from the average rate of return of the stocks comprising the index. Equally weighted indexes are frequently used by financial researchers to measure portfolio performance. The following three defense stocks are to be combined into a stock index in January 2022 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Shares (millions) Price 1/1/22 1/1/23 1/1/24 Douglas McDonnell 200 $ 70 $ 73 $ 87 Dynamics General 300 51 46 60 International Rockwell 390 80 69 86 Compute the rate of return on an equally weighted index of the three defense stocks for the year ending December 31, 2

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