31% D 4:28D) None of the above21. Funds Alpha and Beta have thefollowing as shown below. If you willinvest $5,000,000 and expect a rateof return on both funds 14%, whichstatement is CORRECT? (*Note thatthe Back-End load declines by 1%annually) *Fund AlphaFund BetaFront-End load0%5%Back-End Load7%*0%1.2%12B-1 fees0.85%Expense Ratio0.15%0%A) Fund Alpha is better than FundBeta since value of investment in 3years is greater.B) Fund Beta is better than FundAlpha since value of investment in 3years is greater.C) Value of investment of FundAlpha in 10 years $16,972,836D) A & CE) None of the above

Solution- Option (A) is correct answer Particulars Working Alpha Beta Investment 50,00,000…

21. Funds Alpha and Beta have the following as shown below. If you will invest $5,000,000 and expect a rate of return on both funds 14%, which statement is CORRECT? (*Note that the Back-End load declines by 1% annually) *

21. Funds Alpha and Beta have the following as shown below. If you will invest $5,000,000 and expect a rate of return on both funds 14%, which statement is CORRECT? (Note that the Back-End load declines by 1% annually)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

31% D 4:28
D) None of the above
21. Funds Alpha and Beta have the
following as shown below. If you will
invest $5,000,000 and expect a rate
of return on both funds 14%, which
statement is CORRECT? (*Note that
the Back-End load declines by 1%
annually) *
Fund Alpha
Fund Beta
Front-End load
0%
5%
Back-End Load
7%*
0%
1.2%
12B-1 fees
0.85%
Expense Ratio
0.15%
0%
A) Fund Alpha is better than Fund
Beta since value of investment in 3
years is greater.
B) Fund Beta is better than Fund
Alpha since value of investment in 3
years is greater.
C) Value of investment of Fund
Alpha in 10 years $16,972,836
D) A & C
E) None of the above

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