Question

A. Fill in the blank:

Stock	Initial Price	Final Price	# of shares outstanding(millions)	Initial value of outstanding stock ($mill)	Final value of outstanding stock ($mill)
Lindner	$35	$60	6
Bearcat	$105	$108	3
Total	$140	$168		$525	$684

B. Find the index return for a price-weighted index (round to nearest percent ex: 54.7%>>55%) :

C. Find the index return for a value-weighted index (round to nearest percent ex: 54.7%>>55%) :

D. Find the index return for a equally-weighted index (round to nearest percent ex: 54.7%>>55%) :

Answer 1

Stock	Initial Price	Final Price	# shares (in Mn)	Initial Value (in Mn)	Final Value (in Mn)	Return (%)
	A	B	C	D=A*C	E=B*C	(E-D)/D
Lindner	35	60	6	210	360	71%
Bearcat	105	108	3	315	324	3%
Total			9	525	684
Price Weighted Index
Initial Price	70	(35+105)/2
Final Price	84	(60+108)/2
Return	20%	(84-70)/70
Value Weighted Index
Initial Value	525
Final Value	684
Return	30%	(684-525)/525
Equal Weighted Index
Return	37%	(71%+3%)/2

All answers are provided in table.

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