Explain what is meant by an index being price weighted

Assignment Help Financial Management
Reference no: EM131231862

1. Explain what is meant by an index being price weighted. In a price-weighted average, would you expect a $10 stock or a $50 stock to be more important? Why?

2. Explain how to compute a market-weighted average.

3. Explain how to calculate an unweighted average index.

Reference no: EM131231862

Questions Cloud

Prepare a paper on data communication and networks : Prepare a paper on Data Communication and Networks - ISCG6401 - report is an in depth look at the computer network structure of Four university campuses
Identify and explain the deadweight losses of the tariff : Identify and explain the deadweight losses of the tariff associated with increased domestic production. (Do not include the impact of losses associated with decreased domestic consumption.)
Managing family relationships in a negotiation : Consider this scenario: You and your brother work for your father’s successful family business, which employs 15 individuals. Your role has evolved from being the Chief Machinist to being the General Manager and main salesperson for the business. Dis..
Sociology of developing countries class : According to the World Bank and International Monetary Fund (IMF), over one billion people in the world today are caught in the poverty trap. Identify key economic, social, or political reasons why some people within the developing world live on $..
Explain what is meant by an index being price weighted : Explain what is meant by an index being price weighted. In a price-weighted average, would you expect a $10 stock or a $50 stock to be more important? Why?
Is this affirmative action plan valid : The RiverHill County Public Library has 516 employees, including 163 librarians. A study reveals that seven out of ten supervisors in the library branches are male, although men make up only 25 percent of the branch librarians. Is this affirmative ac..
What is the heat transfer for the process : How does pressure vary with volume, and what is the heat transfer for the process?
Calculate daily percentage change in price for each stock : Calculate the daily percentage change in price for each stock. - Calculate a price-weighted average for Days 1-6.-  Calculate a market-weighted average for Days 1-6.
What is interesting or helpful about this view : Identify the informal fallacies, assumptions, and biases involved in manipulative appeals and abuses of language. Create written work utilizing the concepts of critical thinking.

Reviews

Write a Review

Financial Management Questions & Answers

  About governmental entitlement programs

Given all of the press about governmental entitlement programs, and the possibility that Social Security will be unsustainable in 30 years, if you could make a change, what would it be (and why)?

  The investment of this buyer as function of interest rate r

Consider a homebuyer/investor who plans to buy a new house, the price of which is 1 million dollars. Suppose the buyer does not have any initial savings for the down payment. That is, if the mortgage asks him to repay more than $ 50,000 per year (thi..

  What is the market risk premium

Stock A has a beta of .8, and investors expect it to return 9%. Stock B has a beta of 1.2, and investors expect it to return 13%. Use the CAPM to find the expected rate of return and the market risk premium on the market. What is the Market Risk Prem..

  What is the investors overall profit and loss

On Dec 31 an investor longs 18 contracts of Gold with a settlement price of 1185.40. What is the investors overall profit/loss? The contract size is 100 troy oz

  Existing credit card and make no subsequent payments

You receive a credit card application from Shady Banks Savings and Loan offering an introductory rate of .4 percent per year, compounded monthly for the first six months, increasing thereafter to 16.7 percent compounded monthly. Assume you transfer t..

  What annually compounded rate of interest

Your bank balance is exactly $10,000. Three years ago you deposited $7,938 and have not touched the account since. What annually compounded rate of interest has the bank been paying?

  Recently purchased auto parts worth

Flint Corp. recently purchased auto parts worth 17.5 million Mexican pesos (MP). Management needs to find out the U.S. dollar cost of the payables. It has access to two quotes for Canadian dollars (C$): C$1.3174/$ and C$0.1271/MP. What will it cost F..

  Shares of common stock outstanding-earnings per share

Makers Corp. had additions to retained earnings for the year just ended of $313,000. The firm paid out $177,000 in cash dividends, and it has ending total equity of $4.82 million. The company currently has 140,000 shares of common stock outstanding. ..

  Compensation package is unaffected by the profits

Explain how agency costs might be found within a firm whose CEO owns no shares in the firm and whose compensation package is unaffected by the profits (cash or accounting profits) of the firm.

  What is the cash balance deduction

What is the Cash Balance Deduction? What is the Dollar Return that could be earned on these savings? What is the maximum monthly charge Cookie Cutter should pay for this lockbox system if the payment is due at the end of the month?

  How much is your organization losing per year

Your organization sees 100,000 patients in its emergency room (ER). The rate of patients that leave your ER without being seen (LWBS) is 4%. Data shows that 20% of patients seen are usually admitted. The financial input per 1 admitted patient is $10,..

  Computing the constant growth dividend model

The last dividend of Delta, Inc was $2.69, the growth rate of dividend is expected to be 2.46% and the required rate of return on this stock is 12.46%. What is the stock price according to the constant growth dividend model? Round the answer to tw..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd