Find value-weighted index for today find the new

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Assume there are 5 stocks: A, B, C, D, E of 5 different firms. You are to calculate an index using their prices and values. Say the prices of these stocks today are 25, 30, 50, 20, and 60 respectively. The firms have 100m, 80m, 120m, 200m and 250m shares outstanding, respectively.

a. what is the price-weighted index for today?

b. what is value-weighted index for today?

Assume that the price changes to 20, 25, 55, 18, and 50 respectively next day.

c. What is the new price-weighted index for next day? Calculate the percentage change in the price-weighted index?

d. What is the new value-weighted index for next day? Calculate the percentage change in the value-weighted index?

Assume that firm E divides the stock using a two-for-one split formula. What will be the new divisor for the price-weighted index?

Reference no: EM13476279

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