Question
In: Statistics and Probability
Boran Stockbrokers, Inc., selects four stocks for the purpose of developing its own index of stock...
Boran Stockbrokers, Inc., selects four stocks for the purpose of developing its own index of stock market behavior. Prices per share for a year 1 base period, January year 3, and March year 3 follow. Base-year quantities are set on the basis of historical volumes for the four stocks.
| Stock | Industry | Year 1 Quantity |
Price per Share ($) | ||
|---|---|---|---|---|---|
| Year 1 Base |
January Year 3 |
March Year 3 |
|||
| A | Oil | 100 | 29.50 | 24.75 | 22.50 |
| B | Computer | 150 | 65.00 | 49.00 | 49.50 |
| C | Steel | 75 | 40.00 | 31.00 | 29.50 |
| D | Real Estate | 50 | 18.00 | 6.50 | 2.75 |
Compute the price relatives for the four stocks making up the Boran index. (Round your answers to one decimal place.)
| Stock | Price Relative | |
|---|---|---|
| January | March | |
| A | ||
| B | ||
| C | ||
| D | ||
Use the weighted average of price relatives to compute the January year 3 and March year 3 Boran indexes. (Round your answers to one decimal place.)
IJan=
IMar=
Solutions
orchestra answered 2 years agoRelated Solutions
Boran Stockbrokers, Inc., selects four stocks for the purpose of developing its own index of stock...
Boran Stockbrokers, Inc., selects four stocks for the purpose of
developing its own index of stock market behavior. Prices per share
for a year 1 base period, January year 3, and March year 3 follow.
Base-year quantities are set on the basis of historical volumes for
the four stocks.
Stock
Industry
Year 1
Quantity
Price per Share
($)
Year 1
Base
January
Year 3
March
Year 3
A
Oil
100
31.50
20.75
22.50
B
Computer
150
65.00
49.00
45.50
C...
Boran Stockbrokers, Inc., selects four stocks for the purpose of developing its own index of stock...
Boran Stockbrokers, Inc., selects four stocks for the purpose of
developing its own index of stock market behavior. Prices per share
for a year 1 base period, January year 3, and March year 3 follow.
Base-year quantities are set on the basis of historical volumes for
the four stocks.
Stock
Industry
Year 1
Quantity
Price per Share
($)
Year 1
Base
January
Year 3
March
Year 3
A
Oil
100
29.50
22.75
22.50
B
Computer
150
65.00
49.00
47.50
C...
1. a. You are creating an index for the four following stocks: Stock Price, t=0 Price,...
1.
a. You are creating an index for the four following stocks:
Stock
Price, t=0
Price, t=1
Shares (million)
ABC
122
107
100
DEF
46
50
500
GHI
21
26
1,200
JKL
26
30
450
What is the one day return for the index if it is
price-weighted? Present your answer as the percent change from t=0
to t=1 to the nearest two decimals in this format, 1.23%
b.
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Price, t=0
Price, t=1
Shares (million)
ABC
122
107
100...
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The following three defense stocks are to be combined into a stock index in January 2019...
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). Assume the index is scaled by a factor of 10 million;
that is, if the total value of all firms in the market is $5
billion, the index would be quoted as 500.
PRICE
Shares
(millions)
1/1/19
1/1/20
1/1/21
Douglas McDonnell
425
$
72
$
75
$
92...
The following three defense stocks are to be combined into a stock index in January 2019...
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):
Price Shares (millions) 1/1/19 1/1/20 1/1/21
Douglas McDonnell 210 $94 $ 97 $ 111
Dynamics General 450 $36 $31 $45
International Rockwell 350 $65 $54 $68
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The following three defense stocks are to be combined into a stock index in January 2016...
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stock index in January 2016 (perhaps a portfolio manager believes
these stocks are an appropriate benchmark for his or her
performance). Assume the index is scaled by a factor of 10 million;
that is, if the total value of all firms in the market is $5
billion, the index would be quoted as 500.
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Shares
(millions)
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Douglas McDonnell
350
$
65
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69
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The following three defense stocks are to be combined into a stock index in January 2016...
The following three defense stocks are to be combined into a
stock index in January 2016 (perhaps a portfolio manager believes
these stocks are an appropriate benchmark for his or her
performance). Assume the index is scaled by a factor of 10 million;
that is, if the total value of all firms in the market is $5
billion, the index would be quoted as 500.
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Shares
(millions)
1/1/16
1/1/17
1/1/18
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200
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87...
The following three defense stocks are to be combined into a stock index in January 2016...
The following three defense stocks are to be combined into a
stock index in January 2016 (perhaps a portfolio manager believes
these stocks are an appropriate benchmark for his or her
performance). Assume the index is scaled by a factor of 10 million;
that is, if the total value of all firms in the market is $5
billion, the index would be quoted as 500.
Price
Shares
(millions)
1/1/16
1/1/17
1/1/18
Douglas McDonnell
350
$
65
$
69
$
81...
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