Asked by Chhor Sotheanea on Jul 12, 2024
Verified
A benchmark index has three stocks priced at $23, $43, and $56. The number of outstanding shares for each is 350,000 shares, 405,000 shares, and 553,000 shares, respectively. If the market value weighted index was 970 yesterday and the prices changed to $23, $41, and $58 today, what is the new index value?
A) 960
B) 970
C) 975
D) 985
Market Value Weighted Index
An index in which each constituent is weighted according to its market value, so larger companies have a bigger impact on the index's performance.
Index Value
The total value of all the stocks or securities within a specific index, representing the performance of a particular market or market segment.
- Compute and examine the return on investment for financial indices and singular investment options.
Verified Answer
SN
× 970 = 975
Learning Objectives
- Compute and examine the return on investment for financial indices and singular investment options.