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a. Calculate the initial value of the index if a price-weighting scheme is used. Index value

a. Calculate the initial value of the index if a price-weighting scheme is used. Index value

MATLAB: An Introduction with Applications
MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
Section: Chapter Questions
Problem 1P
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Problem 5-14 Price-Weighted Indexes (LO4, CFA2) 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): Douglas McDonnell Dynamics General International Rockwell Index value Shares (millions) 420 2019 return 2020 return 450 250 % % 1/1/19 $ 63 53 82 Price a. Calculate the initial value of the index if a price-weighting scheme is used. 1/1/20 $ 67 47 71 1/1/21 $ 84 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.) 61 87
Transcribed Image Text:Problem 5-14 Price-Weighted Indexes (LO4, CFA2) 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): Douglas McDonnell Dynamics General International Rockwell Index value Shares (millions) 420 2019 return 2020 return 450 250 % % 1/1/19 $ 63 53 82 Price a. Calculate the initial value of the index if a price-weighting scheme is used. 1/1/20 $ 67 47 71 1/1/21 $ 84 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.) 61 87
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