Question
. Suppose there are only two stocks in the market and the following information is given: Company Shares Outstanding Price per Share Digimax 10 million
. Suppose there are only two stocks in the market and the following information is given:
| Company | Shares Outstanding | Price per Share |
| Digimax | 10 million | $60 |
| Wintech | 30 million | $30 |
2.1 (0.5 pt.) What is the weight of Digimax in the price-weighted index and the value-weight index, respectively?
2.2 (0.5 pt.) Suppose the current divisor is 2. If the next day, Digimax undergoes a 2-for-1 stock split, what is the new post-split divisor for the price-weighted index?
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Finance At The Threshold
Authors: Christopher Houghton Budd
1st Edition
0566092115, 978-0566092114
