If the market prices of each of the 30 stocks in the Dow Jones Industrial Average (DJIA) all change by the same percentage amount during a given day, which stock will have the greatest impact on the DJIA?
A) The stock trading at the highest dollar price per share
B) The stock having the greatest amount of debt in its capital structure
C) The stock having the greatest amount of equity in its capital structure
D) The stock having the lowest volatility

Question

Quizplus · Accepted Answer

The DJIA is a price-weighted index, meaning that stocks with higher share prices have a greater impact on the index's movement. Therefore, the stock trading at the highest dollar price per share will have the greatest impact on the DJIA.

If the Market Prices of Each of the 30 Stocks