The Value of a Standard & Poor's Index Is Computed

question 57

Multiple Choice

The value of a Standard & Poor's Index is computed by

• A) dividing the sum of the closing share prices by an adjusted divisor.
• B) dividing the sum of the closing share prices by a divisor and then multiplying the quotient by 100.
• C) dividing the sum of the current market value of all the stocks in the index by a divisor adjusted for changes in the companies composing the Index.
• D) dividing the sum of the current market value of all the stocks in the index by 1 million.

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Definitions:

Marginal Product

The additional output that is produced by adding one more unit of a specific input while holding all other inputs constant.

Demand Curve

A graphical representation of the relationship between the price of a good and the quantity demanded.

Labor

Utilization of human physical and mental capabilities in the generation of goods and services.

Great Recession

The significant global economic downturn that occurred from late 2007 through mid-2009, characterized by widespread financial crisis, high unemployment, and declines in the housing market.