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Stock P0 Q0 P1 Q1 P2 Q2 A 90 100 95 100 95 100 B 50 200 45 200 45 200 C 100 200 110
Stock | P0 | Q0 | P1 | Q1 | P2 | Q2 |
A | 90 | 100 | 95 | 100 | 95 | 100 |
B | 50 | 200 | 45 | 200 | 45 | 200 |
C | 100 | 200 | 110 | 200 | 55 | 400 |
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a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t = 1). |
b. What must happen to the divisor for the price-weighted index in year 2? |
c. Calculate the rate of return for the second period (t = 1 to t = 2). |
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