Consider the following information on the stock market in a small economy. Shares Company Outstanding Price, beginning of year Price, end of year 1 100 10 2 1,000 points 3 10,000 $ 100 $ 20 $ 3 $ 94 $ 25 $ 6 Help Save & Exit Submit eBook References Instructions: Enter your responses rounded to one decimal place. a. Compute a price-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change? The percentage change is | %. b. Compute a value-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change? (Note: The value of a firm is calculated by multiplying the number of its shares by the prices of those shares.) The percentage change is %.

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Consider the following information on the stock market in a small economy.
Shares
Company Outstanding Price, beginning of year Price, end of year
1
100
10
2
1,000
points
3
10,000
$ 100
$ 20
$ 3
$ 94
$ 25
$ 6
Help
Save & Exit
Submit
eBook
References
Instructions: Enter your responses rounded to one decimal place.
a. Compute a price-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?
The percentage change is |
%.
b. Compute a value-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?
(Note: The value of a firm is calculated by multiplying the number of its shares by the prices of those shares.)
The percentage change is
%.
Transcribed Image Text:Consider the following information on the stock market in a small economy. Shares Company Outstanding Price, beginning of year Price, end of year 1 100 10 2 1,000 points 3 10,000 $ 100 $ 20 $ 3 $ 94 $ 25 $ 6 Help Save & Exit Submit eBook References Instructions: Enter your responses rounded to one decimal place. a. Compute a price-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change? The percentage change is | %. b. Compute a value-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change? (Note: The value of a firm is calculated by multiplying the number of its shares by the prices of those shares.) The percentage change is %.
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