Problem 4-06

Consider the following stock price and shares outstanding information.

	DECEMBER 31, Year 1				DECEMBER 31, Year 2
	Price		Shares Outstanding		Price		Shares Outstanding
Stock K	$23		110,000,000		$35		110,000,000
Stock M	72		2,100,000		45		4,200,000a
Stock R	39		22,000,000		43		22,000,000
aStock split two-for-one during the year.

1. Compute the beginning and ending values for a price-weighted index and a market-value-weighted index. Assume a base value of 100 and Year 1 as the base period. Do not round intermediate calculations. Round your answers to two decimal places.

   PWI_{Year 1}:

   PWI_{Year 2}:

   VWI_{Year 1}:

   VWI_{Year 2}:

2. Compute the percentage change in the value of each index during the year. Do not round intermediate calculations. Round your answers to two decimal places.

   Percentage change in PWI: %

   Percentage change in VWI: %

3. Compute the percentage change for an unweighted index assuming $1,000 is invested in each stock. Do not round intermediate calculations. Round your answer to two decimal places.

   %