Question
You created an index of four stocks that have share prices of $120, $290, $375, and $440 and market capitalizations of $180 million, $400 million,
- You created an index of four stocks that have share prices of $120, $290, $375, and $440 and market capitalizations of $180 million, $400 million, $350 million, and %150 million, respectively.
- Required
(a) what is the index value of a price-weighted index using the four stocks?
(b) if the stock with a price of $440 is replaced by a stock with a price of $220, what is the new index denominator?
Step by Step Solution
3.41 Rating (160 Votes )
There are 3 Steps involved in it
Step: 1
a To calculate the index value of a priceweighted index we sum up the share ...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Statistics For Business And Economics
Authors: David R. Anderson, Dennis J. Sweeney, Thomas A. Williams
11th Edition
978-0324783254, 324783256, 978-0324783247, 324783248, 978-0538481649
