**Mutual Fund Investment Calculation**Lee Ray bought 130 shares of a mutual fund with a Net Asset Value (NAV) of $13.10. This fund also has a load charge of 8.5%.**a. What is the offer price?***Note: Round your intermediate and final answer to the nearest cent.*(Offer Price Input Box)**b. What did Lee pay for his investment?***Note: Round your answer to the nearest cent.*(Investment to be Paid Input Box)

In this question, we will calculate the offer price of a mutual fund and determine how much Lee Ray…

Answered: Lee Ray bought 130 shares of a mutual…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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5. Comparing loads and fees Claire wants to buy shares in a mutual fund and has narrowed her selection to the following four funds. Answer the questions below to help assess each fund in terms of the fees each charges. Fund NAV Net Chg. YTD % Ret. MinT p $15.32 -0.05 2.5 IntRA r $18.77 0.05 5.4 MRGG r $27.81 0.19 7.9 MajTrkⁿ $45.21 0.28 9.0 Suppose MajTrkⁿ charges a commission of 8%. This_________an example of a relatively low-load fund. If Claire purchases $4,000 worth of MajTrkⁿ shares, only $___________will actually be invested. This means that the commission—as a percentage of the amount invested—is equal to . The mutual fund MinT p is a no-load fund that imposes a_________on reinvested dividends as well as on the initial investment. Funds that charge this type of fee _________ generally be expected to outperform funds that do not charge these fees. Claire is planning on holding her shares for at least a year and wants a fund that…
The Market Edge Mutual Fund charges a 3 percent back-end load. Todd invested $2,500 in this fund sixteen years ago. Today, the total NAV value of his shares is $9,948 so he decided to withdraw the entire amount and take a month's vacation to tour South America. How much did Todd receive when he made his withdrawal? O $9,948.00 O $10,246.44 O $9,873.00 O $10,023.00 O $9,649.56
Over a four-year period, Matt Ewing purchased shares in the ClearBridge Large-Cap Value Fund. Use the following information: Year Investment Amount Price per Share 2018 $ 3,100 $ 29 per share 2019 3,100 37 per share 2020 3,100 34 per share 2021 3,100 36 per share At the end of four years, what is the total amount invested? At the end of four years, what is the total number of mutual fund shares purchased? At the end of four years, what is the average cost for each mutual fund share?
An open-end mutual fund owns 1,000 shares of Dunkin Donut priced at $14.20/sh. The fund also owns 2,000 shares of Starbucks priced at $27.50/sh., and 5,000 shares of Gino’s Pizza priced at $12.00/sh. The fund itself has 4,000 of its own shares outstanding. What is the NAV of this mutual fund? A. $12.92 B. $35.80 C. $16.15 D. $17.90 E. $32.30
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A mutual fund’s net asset value is $39.30, but the fund charges a 3 percent load fee (front- loaded) and an exit fee of 1 percent (if redeemed in 6 months) of net asset value. An individual client purchases 10 shares of the mutual fund on Jan 5 of year 20X1. During the year 20X1, the fund distributes $3.45 capital gain and $0.75 dividend income. The net asset value rises to $42.12 on Jan 5 of year 20X2 and the investor redeems the shares. a) What is the percentage return the fund can report that was achieved by its portfolio managers? b) What is the percentage return the individual earned on the investment? Why is this answer different from the answer in part (a)?
Estimating Returns. Hunter invested $8,200 in shares of a load mutual fund. The load of the fund is 7%. When Hunter purchased the shares, the NAV per share was $81. A year later, Hunter sold the shares at a NAV of $78 per share. What is Hunter's return from selling his shares in the mutual fund? Hunter's return from selling his shares in the mutual fund is -4.65 %. (Round to two decimal places and include a negative sign where appropriate.)
Suppose MajTrk has a front-end load fee of 7%. If you purchase 100 shares of this fund at the NAV, you will pay a commission of . If, in one month, you sell the shares, you pay a redemption fee at that time. If you are interested only in funds without any fee, you to use additional online resources to find no-load funds, because using only the quotations as listed in the table, it is to determine the amount of any front-end load fee that the fund may charge.
Investor Matt has $661,000 to invest in a CD and a mutual fund. The CD yields 7.3% and the mutual fund yields an average of 7.7%. The mutual fund requires a minimum investment of $20,000, and Matt requires that at least 4 times as much money be invested in the CD as in the mutual fund. You must invest in order to maximize his return. What is the maximum return? Enter 0 if no investment can be made satisfying the requirements. $ . Round to the nearest cent.
You purchased 1,000 shares of a mutual fund at an offer price of $13.28 per share. Several months later you sold the shares for $14.62 per share. During the time you owned the shares, the fund paid a dividend of $0.69 per share. What was your return on investment? Round to the nearest tenth. %

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