Question 33

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a) A mutual fund has the following fees and expenses. Front load of 5%, back load of 1%, 12b-1 of 0.5% and annual expenses of 1.5%. The return on the portfolio assets is 13%. If you invest $10,000 today, how much will you have at the end of 7 years?

b) Another mutual fund has the following fees and expenses. Front load of 2%, back load of 0%, 12b-1 of 1% and annual expenses of 1.5%. The return on the portfolio assets is 13%. If you invest $10,000 today, how much will you have at the end of 5 years?

c) Looking back at the two funds, at what point do the two funds give the same return?