The Closed Fund is a closed-end investment company with a portfolio currently worth $190 million. It has liabilities of $8 million and 10 million shares outstanding. a. What is the NAV of the fund? (Round your answer to 2 decimal places.) NAV b. If the fund sells for $15 per share, what is its premium or discount as a percent of net asset value? (Input the amount as a positive value. Round your answer to 2 decimal places.) of %
The Closed Fund is a closed-end investment company with a portfolio currently worth $190 million. It has liabilities of $8 million and 10 million shares outstanding. a. What is the NAV of the fund? (Round your answer to 2 decimal places.) NAV b. If the fund sells for $15 per share, what is its premium or discount as a percent of net asset value? (Input the amount as a positive value. Round your answer to 2 decimal places.) of %
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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Transcribed Image Text:The Closed Fund is a closed-end investment company with a portfolio currently worth $190 million. It has liabilities of $8 million and 10
million shares outstanding.
a. What is the NAV of the fund? (Round your answer to 2 decimal places.)
NAV
b. If the fund sells for $15 per share, what is its premium or discount as a percent of net asset value? (Input the amount as a positive
value. Round your answer to 2 decimal places.)
of
%
Expert Solution
Step 1
NAV of the Fund
The total value of the assets owned less the total liabilities equals the Net Asset Value (NAV), which calculates the market value of an investment fund, such as a mutual fund. Since NAV is often represented as a unit price, or as a price per share, the total number of outstanding units must be divided by NAV.
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