You construct a price-weighted index of 55 stocks. At the beginning of the day, the index...

You construct a price-weighted index of 55 stocks. At the beginning of the day, the index is 8,710.44. During the day, 54 stock prices remain the same, and 1 stock price increases $5.40. At the end of the day, your index value is 8,757.89. What is the divisor on your index?

Solutions

Expert Solution

Index price in begining is 8710.44

index price is closing = 8757.89

Change in index price is 47.45

change in index = change in stock price /divisor

47.45 = 5.40/divisor

So divisor is 0.11380400

jeff jeffy answered 2 years ago

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