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Use the following information for the next 2 questions. Stock Price per share Number of free-float shares (million Day 1 Day 2 A $4.23 $4.76

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Use the following information for the next 2 questions. Stock Price per share Number of free-float shares (million Day 1 Day 2 A $4.23 $4.76 83 B. $4.66 $5.71 48 C $8.84 $8.98 22 . Suppose the index level on day 1 is 10,000. Calculate the index level on day 2 using price-weighted method. 9,116 9.645 10,970 12,338 . Suppose the index level on day 1 is 10,000. Calculate the index level on day 2 using free-float-weighted method. 8,875 9,473 10,483 11,267 . . . Which of the following is(are) correct? Stock indexes using price-weighted method can better reflect in the change of the market values of the companies in the indexes than free-float-weighted method. The stock markets in most developed countries use price-weighted method. . I only II only Both I and II Neither I nor II Which of the following isare) correct? . Most bonds are traded over-the-counter All else the same, the yield to maturity of a bond with credit rating of BBB will be lower than a bond with AA rating. . I only II only Both I and II Neither I nor

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