Could you help me slove these problems. Thanks advance! Consider the three stocks in the following table. P _t represents price at time t, and Q represents shares outstanding at time t. Stock B splits...






Could you help me slove these problems. Thanks advance!



Consider the three stocks in the following table. P _t represents price at time t, and Q represents shares outstanding at time t. Stock B splits two-for-one in the last period. Calculate the rate of return on a price-weighted index of the three stocks for the first period (t0 to t1) What must happen to the divisor for the price-weighted index in t2? Calculate the rate of return of the price-weighted index for the 2nd period (t1 to t2). Using the data in the previous problem, calculate the second-period rates of return (t1 to t2) on the following indexes of the three stocks: A market value-weighted index An equally weighted index suppose you short-sell 100 shares of IBM, now selling at $200 per share. What is your maximum possible loss? What happens to the maximum loss if you simultaneously place a stop-buy order at $210?
Nov 11, 2021
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