Question 2 The Wildwood Fund sells Class A shares with a front-end load of 4% and Class B shares with a 12b-1 fee of 1% annually. If you plan to sell the fund after 4 years, are Class A or Class B shares the better choice? Assume a 10% annual return net of expenses before the 12b-1 fee is applied and initial investment of $10,000. a) The answer cannot be determined from the information given. O b) There is no difference. c) Class B. d) Class A. Previous Page Next Page Page 2 of 13
Question 2 The Wildwood Fund sells Class A shares with a front-end load of 4% and Class B shares with a 12b-1 fee of 1% annually. If you plan to sell the fund after 4 years, are Class A or Class B shares the better choice? Assume a 10% annual return net of expenses before the 12b-1 fee is applied and initial investment of $10,000. a) The answer cannot be determined from the information given. O b) There is no difference. c) Class B. d) Class A. Previous Page Next Page Page 2 of 13
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1.
Transcribed Image Text:Question 2
The Wildwood Fund sells Class A shares with a front-end load of 4% and Class
B shares with a 12b-1 fee of 1% annually. If you plan to sell the fund after 4
years, are Class A or Class B shares the better choice? Assume a 10% annual
return net of expenses before the 12b-1 fee is applied and initial investment of
$10,000.
a) The answer cannot be determined from the information given.
b) There is no difference.
c) Class B.
d) Class A.
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