Consider the three stocks in the following table. Pt represents price at time splits two-for-one in the last period. ABC Po 86 46 92 le 100 200 200 Rate of return P1 91 41 102 Q1 100 200 200 1.89 % P2 91 41 51 Required: a. Calculate the rate of return on a price-weighted index of the three stocks intermediate calculations. Round your answer to 2 decimal places.) 22 100 200 400

EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter2: The Domestic And International Financial Marketplace
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Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C
splits two-for-one in the last period.
ABC
Po
86
46
92
le
100
200
200
Rate of return
P1
91
41
102
Q1
100
1.89 %
200
200
P2
91
41
51
Required:
a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t = 1). (Do not round
intermediate calculations. Round your answer to 2 decimal places.)
22
100
200
400
Transcribed Image Text:Consider the three stocks in the following table. Pt represents price at time t, and Qt represents shares outstanding at time t. Stock C splits two-for-one in the last period. ABC Po 86 46 92 le 100 200 200 Rate of return P1 91 41 102 Q1 100 1.89 % 200 200 P2 91 41 51 Required: a. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t = 0 to t = 1). (Do not round intermediate calculations. Round your answer to 2 decimal places.) 22 100 200 400
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