Which of the following statements is false?
A) The Dow Jones Industrial Average is not a price-weighted index.
B) An American depository receipt is a receipt which represents foreign shares to U.S. investors.
C) Index arbitrage occurs when traders buy and sell stocks with offsetting trades in futures and options in order to lock in profits from price differences between these different markets.
D) New shares of stock are sold in the Primary Market.

Question

Quizplus · Accepted Answer

The Dow Jones Industrial Average (DJIA) is actually a price-weighted index, meaning that it calculates the average based on the price of the included stocks, rather than their total market capitalization or other factors.

Which of the Following Statements Is False