1. What are the major arguments against the use of the Midland Inquirer Oil Index as a measure of the performance of petroleum refining companies? What are some arguments in favor of the continued use of this measure?

2. Why did the index divisor decline from its beginning value of 7 to 1.4238 by December 31, 1987?

3. What are the advantages and disadvantages of Henry's new index relative to the present index?

4. Assuming no changes in capitalization between December 31, 1986, and March 30, 1987, calculate the values for the Inquirer Oil Index and Henry's proposed index on December 31, 1986, and March 30, 1987. Compare the per-centage changes in the two performance measures between December 31, 1986, and March 30, 1987.