7. Nancy is considering investing in an individual variable insurance contract (IVIC) and she is researching the product features of various companies. In particular, she is interested in the kinds of fees and charges that a plan might levy on the funds in which she intends to invest. She has heard about frontend load funds, back-end load funds and no-load funds. She intends to invest $25,000 as a single sum in a non-registered IVIC and keep the investment in the plan for at least 10 years. Based on her intentions, what type of fees and charges should she consider? (A) The front-end load will charge her an annual fee on her deposit of 1% to 2%. (B) The back-end load will levy a charge on any withdrawals of 5% at any time she makes her withdrawal. (C) A no-load fund will allow her investment to grow without any charges levied against it. (D) Fees or charges of some kind will diminish the investment returns on any of these plan types.

7. Nancy is considering investing in an individual variable insurance contract (IVIC) and she is researching the product features of various companies. In particular, she is interested in the kinds of fees and charges that a plan might levy on the funds in which she intends to invest. She has heard about frontend load funds, back-end load funds and no-load funds. She intends to invest $25,000 as a single sum in a non-registered IVIC and keep the investment in the plan for at least 10 years. Based on her intentions, what type of fees and charges should she consider? (A) The front-end load will charge her an annual fee on her deposit of 1% to 2%. (B) The back-end load will levy a charge on any withdrawals of 5% at any time she makes her withdrawal. (C) A no-load fund will allow her investment to grow without any charges levied against it. (D) Fees or charges of some kind will diminish the investment returns on any of these plan types.

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter15: Mutual And Exchange Traded Funds

Section: Chapter Questions

Problem 1FPC

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