EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 2, Problem 1P
a)
Summary Introduction
To determine: The 52 weeks
b)
Summary Introduction
To determine: The 52 weeks rate of return the stocks the NYSE composite average.
c)
Summary Introduction
To determine: The 52 weeks rate of return the stocks in the NASDAQ1 100 average.
d)
Summary Introduction
To determine: The 52 weeks rate of return the stocks in the Russell 2000 index
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Using the data in the chart, calculate the first-period rates of return on the following indexes of the three stocks:
A market-value-weighted index.
An equally weighted index.
stocks
P0
Q0
P1
Q1
P2
Q2
A
90
100
95
100
95
100
B
50
200
45
200
45
200
C
100
200
110
200
55
400
(Pt represents price at time t, and Qt represents shares outstanding at time t.)
Each stock's rate of return in a given year consists of a dividend yield (which might be zero) plus a capital gains yield (which could be positive, negative, or zero). Such returns are calculated for all the stocks in the S&P 500. A weighted average of those returns, using each stock's total market value, is then calculated, and that average return is often used as an indicator of the "return on the market."
Consider the three stocks in the following table. P, represents the price at
time t, and Q, represents the total shares outstanding at time t. Calculate the rate
of return on a price-weighted index of three stocks for the first period (t=0 to t=1).
Table 2: Data for Q4 & Q5
Q0 P1 Q1
PO
100 50 105 50
A
B 200
100 210 100
C 300 100 250 100
Chapter 2 Solutions
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Ch. 2.A - Prob. 1QTDCh. 2.A - Prob. 2QTDCh. 2.A - Prob. 3QTDCh. 2.A - Prob. 1PCh. 2.A - Prob. 2PCh. 2.A - Prob. 3PCh. 2.A - Prob. 4PCh. 2.A - Prob. 5PCh. 2.A - Prob. 6PCh. 2.A - Prob. 7P
Ch. 2.A - Prob. 8PCh. 2 - Prob. 1QTDCh. 2 - Prob. 2QTDCh. 2 - Prob. 3QTDCh. 2 - Prob. 4QTDCh. 2 - Prob. 5QTDCh. 2 - Prob. 6QTDCh. 2 - Prob. 7QTDCh. 2 - Prob. 8QTDCh. 2 - Prob. 9QTDCh. 2 - Prob. 10QTDCh. 2 - Prob. 1PCh. 2 - Prob. 2PCh. 2 - Prob. 3PCh. 2 - Prob. 4PCh. 2 - Prob. 5PCh. 2 - Prob. 6PCh. 2 - Prob. 7PCh. 2 - Prob. 8PCh. 2 - Prob. 9PCh. 2 - Prob. 10PCh. 2 - Prob. 11PCh. 2 - Prob. 12PCh. 2 - Prob. 13P
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.Similar questions
- Consider the three stocks in the following table. Pt represents price at time t, Qt represents shares outstanding at time t. Stock C splits two for one in the second period from t=1 to t=2. Calculate the rate of return on a price-weighted index consisting of the three stocks for the first period from t=0 to t=1. Answer in percentage. Stock P0 Q0 P1 Q1 P2 Q2 A 70 475 75 475 75 475 B 45 850 40 850 40 850 C 50 300 60 300 30 600 a. 0.00% b. 2.49% c. 6.06% d. 8.95% e. 1.30%arrow_forwardIf you plotted the returns of a particular stock versus those on theS&P 500 Index over the past 5 years, what would the slope of theregression line tell you about the stock’s market risk?arrow_forwardHow do you calcuate the bechmark and historical return for the stock ARKK when the last price listed is $123.40 and the current value is $26,531.00.arrow_forward
- A prospective investor obtained the following information on XY stock: Date Stock Prices ($) Dividends Paid 4/01/2020 61.25 2/02/2020 52.38 0.75 4/05/2020 64.88 0.75 30/06/2020 70.50 0.75 25/10/2020 75.75 0.75 30/12/2020 71.00 Calculate the time-weighted rate of return using both the Linking and Index methods.arrow_forwardAn analyst gathered the following information for a stock and market parameters: stock beta = 1.42; expected return on the Market = 11.41%; expected return on T-bills = 2.12%; current stock Price = $9.64; expected stock price in one year = $12.81; expected dividend payment next year = $1.54. Calculate the required return for this stock. Please share your answer as a percentage rounded to 2 decimal places.arrow_forwardAn analyst gathered the following information for a stock and market parameters: stock beta = 0.757; expected return on the Market = 11.65%; expected return on T-bills = 3.02%; current stock Price = $9.92; expected stock price in one year = $8.20; expected dividend payment next year = $2.92. Calculate the required return and expected return for this stock. Please write your answers as percentages (e.g. 1234 should be written as 12.34): A. Required Return: B. Expected Return: % %arrow_forward
- 1. You are given the following information regarding prices for a sample of stocks. PRICE Stock Number of Shares T+1 A 1,000,000 60 80 10,000,000 20 35 30,000,000 18 25 Chapter 4: Security Market Indexes and Index Funds 117 a. Construct a price-weighted index for these three stocks, and compute the percentage change in the index for the period from T to T + 1. b. Construct a value-weighted index for these three stocks, and compute the percentage change in the index for the period from T to T + 1. e. Briefly discuss the difference in the results for the twu indexes. 2. a. Given the data in Problem 1, construct an equal-weighted index by assuming $1,000 is invested in each stock. What is the percentage change in wealth for this portfolio? b. Compute the percentage of price change for each of the stocks in Problem 1. Compute the arithmetic mean of these percentage changes. Discuss how this answer compares to the answer in part (a). c. Compute the geometric mean of the percentage changes…arrow_forwardA stock has had the following year-end prices and dividends: Year 1 Price $ 64.43 Dividend 2 71.30 $ .62 3 77.10 .67 4 63.37 .73 5 73.31 .82 6 80.75 .89 What are the arithmetic and geometric returns for the stock?arrow_forwardAn analyst gathered the following information for a stock and market parameters: stock beta= 1.08; • expected return on the Market = 11.97%; • expected return on T-bills = 1.55%; • current stock Price = $9.01; • expected stock price in one year = $11.14; • expected dividend payment next year = $3.23. Calculate the expected return for this stock. Please share your answer as a percentage rounded to 2 decimal places.arrow_forward
- You are given the following information regarding prices for stocks of the followingfirms: PRICE Stock Number of Shares T T+ 1 ScotBank Ltd. 1,000,000 60 80 Jetvan Ltd 10,000,000 20 35 PriceLife Ltd. 30,000,000 18 25 i. Construct a price-weighted index for these three stocks and compute the percentagechange in the series for the period from T to T +1. ii. Construct a market-value-weighted index for these three stocks and compute thepercentage change in the series for the period from T to T +1. iii. Based on your answer above, which of these indexes BEST illustrate the movementon the stock market.arrow_forwardA stock has had the following year-end prices and dividends: Year 0 1 2 3 4 5 Price $16.50 18.68 19.68 18.18 20.52 23.63 Dividend $ 0.15 0.35 0.37 0.38 0.45 What are the arithmetic and geometric returns for the stock? Note: Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.arrow_forwardThe following table shows your stock positions at the beginning of the year, the dividends that each stock paid during the year, and the stock prices at the end of the year. Company US Bank PepsiCo 3DS Uniphase Duke Energy Shares 900 800 1,700 800 Dollar return Percentage return Portfolio Return Beginning of Year Price $45.20 60.78 20.58 28.30 What is your portfolio dollar return and percentage return? (Round your answers to 2 decimal places.) Dividend Per Share $2.23 1.50 % End of Year Price $45.13 64.25 18.36 34.06arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENTFinanceISBN:9781337514835Author:MOYERPublisher:CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course...FinanceISBN:9781337395083Author:Eugene F. Brigham, Phillip R. DavesPublisher:Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (...FinanceISBN:9780357033609Author:Randall Billingsley, Lawrence J. Gitman, Michael D. JoehnkPublisher:Cengage Learning
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:9781337514835
Author:MOYER
Publisher:CENGAGE LEARNING - CONSIGNMENT
Intermediate Financial Management (MindTap Course...
Finance
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Cengage Learning
Pfin (with Mindtap, 1 Term Printed Access Card) (...
Finance
ISBN:9780357033609
Author:Randall Billingsley, Lawrence J. Gitman, Michael D. Joehnk
Publisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Investing For Beginners (Stock Market); Author: Daniel Pronk;https://www.youtube.com/watch?v=6Jkdpgc407M;License: Standard Youtube License