Questions A-G trace a sequence of transactions involving a single mutual fund. A) On January...
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Questions A-G trace a sequence of transactions involving a single mutual fund. A) On January 1 a mutual fund has the following assets and prices at 4:00p.m. Stock Shares owned Price 1,000 $1.97 $48.26 1,000 $26.44 10,000 $67.49 3,000 $2.59 1 2 5,000 3 4 5 Calculate the net asset value (NAV) for the fund. Assume that 8,000 shares are outstanding for the fund. B) An investor sends the fund a check for $50,000. If there is no front-end load, calculate the new number of shares and price per share. Assume the manager purchases 1,800 shares of stock 3, and the rest is held as cash C) On January 2 the prices at 4:00 p.m. are as follows: Stock Shares owned 1 1,000 2 5.000 3 2.800 10,000 5 3,000 Cash na. Price $2.03 $51.37 $29.08 $67.19 84.42 $2.408.00 Calculate the net asset value (NAV) for the fund. D) Assume the new investor then sells the 420 shares. What is his profit? What is the annualized return? Assume 250 trading days per year. E) Assume that the fund was charging a 2% upfront load. What would have been the return? F) Assume that the fund was charging a 2% back-end load. What would have been the return
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