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): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017.
Price | ||||||||||
Shares (millions) |
1/1/16 | 1/1/17 | 1/1/18 | |||||||
Douglas McDonnell | 545 | $ | 80 | $ | 83 | $ | 98 | |||
Dynamics General | 460 | 70 | 63 | 77 | ||||||
International Rockwell | 190 | 99 | 88 | 91 | ||||||
a. What is the new divisor for the index? (Do not round intermediate calculations. Round your answer to 3 decimal places.)
b. Calculate the rate of return on the
index for the year ending December 31, 2017, if Douglas McDonnell’s
share price on January 1, 2018, is $30.04 per share. (Do
not round intermediate calculations. Enter your answer as a percent
rounded to 2 decimal places.)
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 price-weighted stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017 and that the company enacts the stock split on January 2, 2017. Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 430 $ 108 $ 114 $ 41.08 Dynamics General 535 38 34 48...
QUESTION 4 The following three defense stocks are to be combined into a price-weighted stock index in January 2016 (perhaps a portfolio manager believes these stocks are an appropriate benchmark for his or her performance): Suppose that Douglas McDonnell shareholders approve a 3-for-1 stock split on January 1, 2017 and that the company enacts the stock split on January 2, 2017 Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 195 $ 97 $100 $35.39 Dynamics General 455 22 36 International...
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): Price Shares (millions) 1/1/16 1/1/17 1/1/18 Douglas McDonnell 195 $ 97 $ 100 $ 113 Dynamics General 455 27 22 36 International Rockwell 230 56 45 62 a. Calculate the initial value of the index if a price-weighting scheme is used. b. What is the rate of return...
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...
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 425 $ 72 $ 75 $ 92...
QUESTION 3 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) Price Shares 1/1/16 $ 64 1/1/17 $ 68 Douglas McDonnell Dynamics General International Rockwell 215 455 250 72 64 1/1/18 $ 82 78 1 06 101 90 a. Calculate the initial value of the index if a price-weighting scheme is used. (Enter your answers rounded to...
QUESTION 2 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 Douglas McDonnell Dynamics General International Rockwell Shares (millions) 195 455 230 1/1/16...
Problem 5-14 Price-Weighted Indexes (L04, CFA2) 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): Price Shares (millions) 530 230 330 1/1/16 $ 62 1/1/18 $ 81 Douglas McDonnell Dynamics General International Rockwell - 34 1/1/17 $ 66 28 52 42 63 68 ces a. Calculate the initial value of the index if a price-weighting scheme is...
Problem 5-16 Value-Weighted Indexes (LO4, CFA2) 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 530...
Problem 5-16 Value-Weighted Indexes (LO4, CFA2) 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 Douglas McDonnell Dynamics General International Rockwell Shares (millions)...