The following three defense stocks are to be combined into a stock Index in January 2019 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance). Assume the Index is scaled by a factor of 10 million, that is, if the total value of all firms in the market is $5 billion, the Index would be quoted as 500 Price Shares (millions) Douglas McDonnell Dynamics General Laternational Rockwell 535 45e 1/1/19 $ 89 1/1/2e 594 1/1/21 5109 7e 65 79 230 99 88 105 o. Calculate the initial value of the Index if a value-weighting scheme is used (Round your answer to 2 decimal places.) Index value b. What is the rate of return on this index for the year ending December 31, 2019? For the year ending December 31, 2020? (A negative value should be indicated by a minus sign. Do not round Intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) 2016 rum 2020 retum In addition to price-weighted and value-weighted Indexes, an equally welghted index is one in which the Index value is computed from the average rate of return of the stocks comprising the index Equally welghted Indexes are frequently used by financial researchers to measure portfolio performance. The following three defense stocks are to be combined into a stock Index in January 2019 (perhaps a portfolio manager belleves these stocks are an appropriate benchmark for his or her performance): Price Shares (willions) 415 Douglas McDonnell Dynamics General International Rockwell 1/1/20 $ 89 1/1/19 $ 84 23 52 1/1/21 3106 34 225 350 20 41 55 o. Compute the rate of return on an equally weighted index of the three defense stocks for the year ending December 31, 2019 (A negative value should be indicated by a minus sign. Do not round Intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) index return b. If the index value is set to 100 on January 1, 2019, what will the index volue be on January 1, 2020? (Do not round Intermediate calculations. Round your answer to 2 decimal places.) Index value