Index movements are influenced by differential prices of the components in a(n)
A) Equally-weighted index.
B) Price-weighted index.
C) Unweighted index.
D) Value-weighted index.
E) All of the above

Question

Quizplus · Accepted Answer

In a price-weighted index, the index movements are influenced by the price changes of the components, as each component's weight is determined by its price.

Index Movements Are Influenced by Differential Prices of the Components