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Problem 2-11 Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock

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Problem 2-11 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. A Po lo 110 500 90 600 80 600 Pl ll1 P2 115 500 115 85 60085 100 600 50 l2 500 600 1,200 C 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 10.71% 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 (tr 1 to t= 2). Rate of return 0:%

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