Currently, the Dow Jones Industrial Average is computed by ________.
A) adding the prices of 30 large "blue-chip" stocks and dividing by 30
B) calculating the total market value of the 30 firms in the index and dividing by 30
C) measuring the current total market value of the 30 stocks in the index relative to the total value on the previous day
D) adding the prices of 30 large "blue-chip" stocks and dividing by a divisor adjusted for stock splits and large stock dividends

Question

Quizplus · Accepted Answer

The Dow Jones Industrial Average is currently computed by adding the prices of 30 large "blue-chip" stocks and dividing by a divisor adjusted for stock splits and large stock dividends. This method of computation helps to account for changes in the stock prices due to splits and dividends, ensuring that the index remains comparable over time.

Currently, the Dow Jones Industrial Average Is Computed by ________