## Bm

Bethlehem Steel

Mack Trucks

Union Carbide

American Can

Nash Motors

Goodrich

Radio Corp

U.S. Steel the average unchanged by the substitution. By now, the divisor for the Dow Jones Industrial Average has fallen to a value of about .145.

4. Suppose XYZ's final price in Table 2.4 increases in price to $110, while ABC falls to $20. Find the percentage change in the price-weighted average of these two stocks. Compare that to the percentage return of a portfolio that holds one share in each company.

Dow Jones & Company also computes a Transportation Average of 20 airline, trucking, and railroad stocks; a Public Utility Average of 15 electric and natural gas utilities; and a Composite Average combining the 65 firms of the three separate averages. Each is a price-weighted average and thus overweights the performance of high-priced stocks.

Concept

## Lessons From The Intelligent Investor

If you're like a lot of people watching the recession unfold, you have likely started to look at your finances under a microscope. Perhaps you have started saving the annual savings rate by people has started to recover a bit.

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