Consider a mutual fund with $219 million in assets at the start of the year and...

Transcribed Image Text:

Consider a mutual fund with $219 million in assets at the start of the year and with 12 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $6 million. The stocks included in the fund's portfolio increase in price by 7%, but no securities are sold, and there are no capital gains distributions. The fund charges 12b-1 fees of 0.50%, which are deducted from portfolio assets at year-end. a. What is the net asset value at the start and end of the year? (Enter your answers in dollars rounded to 3 decimal places.) > Answer is complete but not entirely correct. Net Asset Value Start of the year End of the year $ 18.250✔ $ 19.930 X b. What is the rate of return for an investor in the fund? (Do not round intermediate calculations. Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Rate of return 12.21 % Consider a mutual fund with $219 million in assets at the start of the year and with 12 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $6 million. The stocks included in the fund's portfolio increase in price by 7%, but no securities are sold, and there are no capital gains distributions. The fund charges 12b-1 fees of 0.50%, which are deducted from portfolio assets at year-end. a. What is the net asset value at the start and end of the year? (Enter your answers in dollars rounded to 3 decimal places.) > Answer is complete but not entirely correct. Net Asset Value Start of the year End of the year $ 18.250✔ $ 19.930 X b. What is the rate of return for an investor in the fund? (Do not round intermediate calculations. Round your answer to 2 decimal places.) > Answer is complete but not entirely correct. Rate of return 12.21 %

Answer rating: 100% (QA)

To calculate the net asset value NAV at the start and end of the year we need to take into account t... View the full answer