Equity Investments Q79
0. John gathers the following data for an equally-weighted index:
| Security | Price at start ofperiod | Price at end ofperiod $ |
| A | 10 | 15 |
| B | 40 | 38 |
| C | 16 | 20 |
The return on the index over the period is closest to:
- Option : C
- Explanation : With an equal-weighted index, the index return is the average of the return on the constituent securities. Return on A is 50%, Return on B is -5% and Return on C is 25%. The average is 23.3%.
