Question one Suppose you have the following information from Muscat stock market     Stock Share outstanding Base day Closing price Second day closing price Salalah company 18 3 2.8 Dhofar power company 26 2.8 3.1 Oman company 10 4.1 2.1 Dhofar bank 28 3 1.8 Calculate 1. Price weighted index 2. Value weighted index   plz use the formula shows in the pictures

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Question one

Suppose you have the following information from Muscat stock market  

 

Stock

Share outstanding

Base day Closing price

Second day closing price

Salalah company

18

3

2.8

Dhofar power company

26

2.8

3.1

Oman company

10

4.1

2.1

Dhofar bank

28

3

1.8

Calculate

1. Price weighted index
2. Value weighted index

 
plz use the formula shows in the pictures
The formula used in calculating price-weighted index is:
E Pit
Index t
Base day's index level
E Pib
Where:
Index t = Index value on day t
Pit = closing price for company i on day t
Pib = closing price for company i on base day
Beginning Index Value = 100, 1000, etc.
Transcribed Image Text:The formula used in calculating price-weighted index is: E Pit Index t Base day's index level E Pib Where: Index t = Index value on day t Pit = closing price for company i on day t Pib = closing price for company i on base day Beginning Index Value = 100, 1000, etc.
The formula used to calculate Value-Weighted Index is:
E Pit Qit
Index t
Base day's index level
E Pib Qib
i=1
Where:
Index t = Index value on day t
Pit = closing price for company i on dayt
Qit = number of outstanding shares of company i on day t
Pib = closing price for company i on the base date
Qib = number of outstanding shares of company i on the base date
Beginning Index Value = 100, 1000, etc
Transcribed Image Text:The formula used to calculate Value-Weighted Index is: E Pit Qit Index t Base day's index level E Pib Qib i=1 Where: Index t = Index value on day t Pit = closing price for company i on dayt Qit = number of outstanding shares of company i on day t Pib = closing price for company i on the base date Qib = number of outstanding shares of company i on the base date Beginning Index Value = 100, 1000, etc
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