A Value Weighted Index Has Three Stocks with 200 Shares

question 30

Multiple Choice

A value weighted index has three stocks with 200 shares of A, 800 shares of B, and 500 shares of C. On day one their prices are A at $25, B at $28, C at $48. On day two the index is

• A) 106.3.
• B) 99.6.
• C) 104.2.
• D) 101.8.

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Definitions:

Mobile Phone Store

A retail outlet specializing in the sale of mobile phones and related accessories and services.

Portfolio Return

The overall gain or loss generated by an investment portfolio over a specific time period, typically expressed as a percentage.

Covariance

A statistical measure that indicates the extent to which two variables change together.

Variances

Variances measure the dispersion of a set of data points around their mean value, indicating how spread out the data is.