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You are considering an investment in a mutual fund with a 7%load and expense ratio of 0.5%. You can invest instead in a bank CDpaying 3% interest. a. If you plan to invest for 5 years, whatannual rate of return must the fund portfolio earn for you to bebetter off in the fund than in the CD? Assume annual compounding ofreturns. (Do not round intermediate calculations. Round your answerto 2 decimal places.) b. What annual rate of return must the fundportfolio earn if you plan to invest for 7 years to be better offin the fund then in the CD?
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