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Question 3 The following information is available for stocks in four companies as given below: (Per No. of Shares Closing Share) DAY Company Outstanding Price

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Question 3 The following information is available for stocks in four companies as given below: (Per No. of Shares Closing Share) DAY Company Outstanding Price DAY T T +1 Fortis 8000 70 75 CIBC 6000 55 50 JFK 1000 60 65 Amazon 7500 80 84.5 A. Construct a price-weighted index for the four stocks. What are the values for DAY T and DAY T+1? What is the percentage change? (5 marks) B. Construct a market-value-weighted index for the four stocks. Assume that DAY T is the base period and the base value is 50. What is the new index value for DAY T+1 and how has the index changed? (10 marks) C. If an investor has $10,000 to invest, compute an unweighted price indicator series. What is the percentage change for this portfolio? (5 marks) (Total 20 marks)

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