About the dow jones industrial average

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Reference no: EM131879485

Which of the following statements about the Dow Jones Industrial Average (DJIA) is incorrect?

A. The DJIA is a simple average stock price, and therefore, different from most other major market indicators which are true "indexes."

B. To maintain its consistency as a price average, the DJIA has to make adjustment to its calculation whenever there is a change in stock composition or a stock split or a substantial stock dividend for its component stocks.

C. Because of numerous changes that had been made over the years, nowadays the divisor of the DJIA is artificially inflated to a very high number.

D. The DJIA has long lost its relevance as a stock price average.

Reference no: EM131879485

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