QUESTION 1 The World Income Appreciation Fund has current assets with a market v

Question

QUESTION 1

The World Income Appreciation Fund has current assets with a market value of $4 billion and has 110 million shares outstanding. What is the net asset value (NAV) for this mutual fund?

QUESTION 2

The Madura HiGro Fund has a net asset value of $47 per share. It charges a 3.1 percent load. How much will you pay for 200 shares?

QUESTION 3

The World Income Appreciation Fund has current assets with a market value of $4.5 billion and has 130 million shares outstanding. The fund has a current market price quotation of $35.63. What is the front-end load in percentages?

QUESTION 4

You are going to invest in a stock mutual fund with a 7 percent front-end load and a 1.4 percent expense ratio. You also can invest in a money market mutual fund with a 5 percent return and an expense ratio of 0.3 percent. If you plan to keep your investment for 2 years, what annual percentage return must the stock mutual fund earn to exceed an investment in the money market fund?

QUESTION 5

You invested $10,000 in a mutual fund at the beginning of the year when the NAV was $41.98. At the end of the year the fund paid $0.37 in short-term distributions and $1.23 in long-term distributions. If the NAV of the fund at the end of the year was $43.39, what was your return for the year?

QUESTION 6

A closed-end fund has total assets of $250 million and liabilities of $800,000. Currently, 20 million shares are outstanding. If the shares currently sell for $16.1, what is the percentage premium or discount on the fund? (Note: Enter premium as a positive number and a discount as a negative number.)

Explanation / Answer

1. Net assets value= $ 4 billion/110millions = $36.36 /share

2. load charges for 200 shares= (200*47) * 3.1 % = $ 291.4

3. Net assets value= $4.5 billion/ 130 millions = $34.62/ share

front end load= (1.01/34.62)*100= 2.917 %

5. Return= (3.01/41.98)*100= 7.17 %

6. NAV= $249.2millions/ 20 million shares = $ 12.46/share

premium on the fund= (3.64/12.46)*100 = 29.21 %

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