Use the table for the question(s)below.
Consider the following stock price and shares outstanding data:
-If you are interested in creating a value-weighted portfolio of these four stocks,then the percentage amount that you would invest in Lowes is closest to:
A)27.2%.
B)10.6%.
C)15.2%.
D)14.2%.

Question

Use the table for the question(s)below.
Consider the following stock price and shares outstanding data: 
-If you are interested in creating a value-weighted portfolio of these four stocks,then the percentage amount that you would invest in Lowes is closest to:
A)27.2%. 
B)10.6%. 
C)15.2%. 
D)14.2%.

Quizplus · Accepted Answer

To create a value-weighted portfolio, we need to calculate the market value of each stock by multiplying the stock price and shares outstanding. 
Market value of Home Depot = $210 × 14 = $2,940 
Market value of Lowes = $77.50 × 38 = $2,945 
Market value of Target = $85 × 30 = $2,550 
Market value of Walmart = $93 × 20 = $1,860

Total market value = $10,295

The percentage invested in Lowes would be:

(2,945 ÷ 10,295) × 100% = 28.6%

Therefore, the closest answer choice is B) 10.6%.

Use the Table for the Question(s)below