You are considering purchasing a no - load mutual fund with an operating expense of .4% and a 12 b-1 expense of .25% . You are also considering purchasing a CD paying 3.0% per year. Whatminimum annual rate of return must the fund earn to make you better off in the fund versus the CD Group of answer choices 3.65 % 3.0 % 2.35% 3.4%

Annual rate of return refers to the minimum rate that is earned by the investors over the investment…

You are considering purchasing a no-load mutual fund with an operating expense of .4% and a 12 b-1 expense of .25%. You are also considering purchasing a CD paying 3.0% per year. Wh minimum annual rate of return must the fund earn to make you better off in the fund versus the CD Group of answer choices 3.65 % 3.0% 2.35% 3.4%

You are considering purchasing a no-load mutual fund with an operating expense of .4% and a 12 b-1 expense of .25%. You are also considering purchasing a CD paying 3.0% per year. Wh minimum annual rate of return must the fund earn to make you better off in the fund versus the CD Group of answer choices 3.65 % 3.0% 2.35% 3.4%

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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The value in pounds of a fund at time t = 0 is V0 = 50, 000. After one year (at t = 1) it has increased to V1 = 51, 500 and at that time £1, 500 is withdrawn. After two years (at t = 2) the fund is worth V2 = 50, 800. (a) Compute the time-weighted rate of return. (b) If the fund is liquidated after two years what is the yield that has been achieved?
A fund has an initial investment of $100 million from investors. The investors will receive an 8 percent preferred return. After the preferred return is met, remaining distributions will be split 80 percent to the investors and 20 percent to the fund manager. Funds available for distribution after the regular fund management fee are as follows: Fund Cash Flow for Distribution After Management Fee Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8. Year 9 Year 10 $ 5.00 $ 10.00 $ 20.00 $ 30.00 $ 50.00 $ 40.00 $ 30.00 $ 20.00 $ 10.00 $ 5.00 Required: a. How many years will it take until the investor gets the 8 percent preferred return? b. What will be the split in distributions to the investor and the manager for the year found in which preferred return is achieved? c. What will the investor's IRR be over the entire 10 years? d. What will the total promote earned by the fund manager be for the 10 years?
(Present value of an uneven stream of payments) You are given three investment alternatives to analyze. The cash flows from these three investments are as follows: Investment B A $ 1,000 2,000 3,000 (4,000) 1,000 4,000 3,000 (Click on the icon in order to copy its contents into a spreadsheet.) What is the present value of each of these three investments if the appropriate discount rate is 9 percent? $ End of Year 1 SA NM CO 2 3 4 5 $ 1,000 1,000 1,000 C $ 5,000 a. What is the present value of investment A at an annual discount rate of 9 percent? (Round to the nearest cent.) b. What is the present value of investment B at an annual discount rate of 9 percent? (Round to the nearest cent.) c. What is the present value of investment C at an annual discount rate of 9 percent? (Round to the nearest cent.) 5,000 (5,000) (5,000) 15.000
Unit 8-1
In the above $110K allocation problem, you decided to allocate 30% weight in A, 50% weight in B, 20% weight in C, and you want to find its AVG return. Which of the following is the appropriate method to find the mean (AVG) return on the $100K fund invested? a. Weighted Average (WAVG ) b. Simple Average c. Geometric Average d. Arithmetic Average
None
High Growth Fund has a front load of 5% and expected return of 14.5%. Normal Fund has no load. And expected return of 13.8%. Which fund would you hold if you expect to hold the fund for 5 years? How about holding the fund for 10 years? Please show how to solve in excel
Consider risky Funds B and S with the following projections: Fund B S Expected return 6% 10% Standard deviation 2.5% 15% Assume the correlation between Funds B and S is -0.50, and the risk-free rate for a T-bill is 5%. How much of your assets should you invest in Fund S in order to achieve the optimal risky portfolio comprised of Funds B and S? 0% weight in Fund S < 25% 25% weight in Fund S < 50% < 50% weight in Fund S < 75% 75%
help please answer in text form with proper workings and explanation for each and every part and steps with concept and introduction no AI no copy paste remember answer must be in proper format with all working

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