You purchase 100 shares of a no-load mutual fund for $100 per share and sold the shares for $120 per share after a year. Please explain to your classmates how you would calculate the percentage return on your investment?

You purchase 100 shares of a no-load mutual fund for $100 per share and sold the shares for $120 per share after a year. Please explain to your classmates how you would calculate the percentage return on your investment?

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter2: The Domestic And International Financial Marketplace

Section: Chapter Questions

Problem 2P

See similar textbooks

Related questions

Q: By the end of this year you would be 35 years old and you want to plan for your retirement. You wish…

A: We’ll answer the first question since the exact one wasn’t specified. Please submit a new question…

Q: On January 1, 1988, Antonio invests $9,300 in an investment fund. On January 1, 1989 his balance is…

A: The time weighted return for an investment period needs to be shown as a function of the balance.

Q: Please provide detailed explanation: #5 Sarah Mix decides to invest $500 per month in three funds,…

A: Mutual fund is like an investment in various types of securities. When an investor purchases a…

Q: Rodney Cashman has been investing $2,000 quarterly for the past 18 years in an equity mutual fund.…

A: Time value It tells that the money today received by the individual has more value than receiving…

Q: You deposit the following at the end of each year into a growth mutual fund that earns 11 percent…

A: Working note:

Q: You find a mutual fund that offers approximately 6% APR compounded monthly. You will invest enough…

A: Annuity means finite no. of payments which are same in size and made in equal intervals. A person…

Q: suppose you have $5,000 in a mutual fund in your IRA. Suppose also that you put $4,000 into the…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: Q16: If you invest the $10,000 you receive at graduation (age 22) in a mutual fund that averages a…

A: Introduction: Investments are generally made by individuals during the present period in order to…

Q: Suppose you invest $500 in a mutual fund today and $600 in one year. If the fund pays 8% annually…

A: The future value of the money is an accumulation of money with a certain rate for a particular…

Q: At age 28 you invest P 25,000 into a mutual fund. If the fund averages a 7% annual return, your…

A: Using an appropriate discount rate or CVF, compounding is a strategy for calculating the future…

Q: Alan invests a total of $14,500 in three different ways. He invests one part in a mutual fund which…

A: The question is based on the concept of Financial Management.

Q: Elise is adapting the cost averaging in investment. He decided to invest in a mutual fund for 6…

A: In the given problem we need to compute the price of mutual fund units every month, then basis that…

Q: A graduating CE is going to make $35,000/yr with Granite Construction. A total of 10% of the CE…

A: First deposit in mutual fund (D) = 10% of $35000 = $3500 Growth rate in deposits (g) = 3% n = 30…

Q: If Joe has $1,000 and invests it into a mutual fund that returns 10%, what willI be his Future Value…

A: Future value = Present value*(1+rate)^no of years

Q: ou decide to contribute to a mutual fund that averages 3.6% return per year. If you contribute $600…

A: Formula: Future value of annuity = Annuity amount x [ ( 1 + r )n - 1 ] / r N = Number of years R =…

Q: Hugh invests 1000 in a fund on January 1. On May 1, the fund is worth 1,100 and 600 is withdrawn. On…

A: Simple interest is the interest paid or computed only on the principal amount of money. The amount…

Q: Five years ago, you invested in the Future Investco Mutual Fund by purchasing 1,100shares of the…

A: Solution:- Compound rate of return means the annual rate of return earned. We know, amount at…

Q: ) Your best friend has asked to assist him in making the best investment out of the following…

A: to see whether the project is attractive or not one needs to the present value of the particular…

Q: . What would you tell her? Round FVA-factor to four decimal places. Round the answer to the nearest…

A: Information Provided: Annual payment = $2000 Term = 23 years Interest rate = 6%

Q: Your grandfather urged you to begin a habit of saving money early in your life. He suggestedthat you…

A: Future value of annuity is the future value of the same cash flows that takes place at the end of…

Q: Devon invested $10,500 in three different mutual funds. A fund containing large cap stocks made a…

A: Let x= Amount invested in large cap stock y= Amount invested in real estate fund z= Amount invested…

Q: One year ago, Richard purchased 40 shares of common stock for $10 per share. During the year, he…

A: In two ways investors can earn returns from the stock , dividend capital gains capital gains are…

Q: Alexa plans to invest $50,000 in a mutual fund that requires either a 4% front-end load or a 4%…

A: Mutual Fund Mutual funds refer to the type of investment that invests money in different risky as…

Q: If you invest the $10,000 you receive at graduation (age 22) in a mutual fund that averages a 12%…

A: Investments are the processes and methods through which money is saved and funds are invested in…

Q: Carl invests $10000, partly in a secure GIC (Guaranteed Investment Certificate) at 5% and the rest…

A: Both investment options have different interest rates but if investor expects to get same interest…

Q: You have just invested a one -time amount of $4,000 in a stock -based mutual fund. This fund should…

A: Investment = $ 4000 Annual return = 6% Investment period = 28 Years

Q: By the end of this year you would be 35 years old and you want to plan for your retirement. You wish…

A: Retirement account interest = 7% Period of retirement account = 30 years Annual coupon = 6% Annuity…

Q: Marcus would like to save up $3 million for his retirement. He has chosen a stock index fund that…

A: Accumulated amount needed = $3 million r = 7.2% per annum = 0.6% per month n = 40 years = 480 months…

Q: How much could you save for retirement if you chose to invest the money you spend on Starbucks…

A: As per the framing of the Question, 2 alternates are possible: 1 Invested the amount saved in 1st…

Q: Carl invests $10000, partly in a secure GIC at 5% interest per year and the rest in a mutual fund…

A: Given, The amount of investment is $10,000 Interest rate in GIC is 5% Interest rate of MF is 7.5%

Q: N. Ebriate, a college student at a party university, decides to forego beerdrinking and invest the…

A: A theory that helps to compute the present or future value of the cash flows is term as the TVM…

Q: Franco plans to invest P1,500 in a mutual fund. If he earns 12% interest compounded monthly, to what…

A: Future value of annuity is referred as the value of group, which used to recur the payment in the…

Q: you have just invested a one time amount of $4,000 in a stock based mutual fund. this fund should…

A: Mutual fund is simply a scheme whose bussiness is to take money from the retail investors and make a…

Q: A man would like to invest $50,000 in government bonds and stocks that will give an overall annual…

A: Let invested amount in bonds be X Let invested amount in Stock be Y

Q: You deposit the following, at the end of each year, into a growth mutual fund that earns 8% per…

A: The future value is the amount that will be received at the end of a certain period. In simple…

Q: Suppose that at the beginning of Year 1 you invested $10,000 in the Stivers mutual fund and $5,000…

A: When all the sum of the observations is divided by its observations is referred to as Mean or…

Q: Alan invests a total of $11,000 in three different ways. He invests one part in a mutual fund which…

A: Let investment in the bank = y Investment in mutual fund = 2y Investment in government bond = 11,000…

Q: After graduating from Baruch, Amal plans on investing $8,000 every year beginning age 25 to…

A: Note: assuming payments are made at the end of age 25 till end of age 64 then value at the beginnig…

Q: Mary Stahley invested $3500 in a 48-month certificate of deposit (CD) that earned 9.5% annual simple…

A: Solution Concept Simple interest is calculated on the beginning principle and no interest is charged…

Q: . If you have been saving money since you were 20 years old and you save $4 daily and, at the end of…

A: We need to use future value of annuity formula to calculate account balance at 62 year age Future…

Q: By the end of this year you would be 35 years old and you want to plan for your retirement. You wish…

A: Annuity is the number of payments of an equal amount and is made at an equal interval of time. At…

Q: By the end of this year you would be 35 years old and you want to plan for your retirement. You wish…

A: Retirement account is the account in which deposits are made by the individual during the years of…

Q: 4. Jacob invests $2500 a year in a mutual fund for 15 years. If the market value of the fund…

A: Annual investment (P) = $ 2500 Period (n) = 15 Years Interest rate (r) = 5%

Q: Upon starting you new job after graduation, you’ve been confronted with selecting investment for…

A: a) There are four types of investments. According to the information, a contribution of $3600 is…

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 2 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.

Similar questions

You received $2,500 at your graduation party and have decided to invest it in a stock index fund that earns 8% annually, but pays semi-annually. How much will you have 5 years from now?
You have just invested a one -time amount of $4,000 in a stock -based mutual fund. This fund should earn (on average) 6% componded annually over a long period of time . How much will your investment be worth in 28 years?
You deposit the following at the end of each year into a growth mutual fund that earns 11 percent per year: How much should the fund be worth at the end of 5 years How much interest have you earned in total?
You buy a mutual fund for $1,000. It annually distributes $60 for eight years, after which you sell the shares for $900. What is the annualized return on your investment?
You invest $150 each month (starting today) into a mutual fund. You reinvest distributions. At the end of 14 years, you sell all your shares and receive $20,480. Calculate your rate of return.
Three years ago, you invested in the Future Investco Mutual Fund by purchasing 1,000 shares of the fund at a net asset value of $24.00 per share. The fund has a 3% load that you elect to pay in addition to your initial investment to ensure that the full NAV is invested. Because you did not need the income, you elected to reinvest all dividends and capital gains distributions. Today, you sell your 1,100 shares in this fund for $27.98 per share. What is the compounded rate of return on this investment over the 3-year period? Select one: a. 7.58% b. 7.08% c. 24.51% d. 7.53% e. 3.72%
Five years ago, you invested in the Future Investco Mutual Fund by purchasing 1,100shares of the fund at a net asset value of $17.88 per share. Because you did not need the income, you elected to reinvest all dividends and capital gains distributions. Today, you sell your 1,450 shares in this fund for $21.96 per share. What is the compounded rate of return on this investment over the five-year period?
Suppose you invest $50 each month (starting today) into a mutual fund. You reinvest distributions. At the end of 5 years, you sell all your shares and receive $3,485. Calculate your rate of return.
Doris plans to save $5000 per year for the next 35 years. Her money will be deposited in a stock market index fund that has a 0.5% annual management fee. If this fund earns 6% per year, how much will Doris save by investing in this fund instead of an actively managed mutual fund that has a 1% annual fee? Compute your answer as a future amount at the end of year . Assume that payments are made at the end of year. The future equivalent of savings amount at the end of year 35 is ___.
Twelve months ago, you purchased the shares of a no-load mutual fund for $22.05 per share. The fund distributed cash dividends of $0.70 and capital gains of $1.30 per share. If the net asset value of the fund is currently $24.45, what was your annual return on the investment? Round your answer to two decimal places. % If the value of the shares had been $21.14, what would have been your annual return? Round your answer to two decimal places. %
Bylo Selhi wants to know how many years it will take for his mutual fundinvestment of $50,000 to reach $500,000 if his mutual fund pays an averageof 12 percent per year.
About a year ago, Eric Robertson bought some shares in the Diamond Mountain Mutual Fund. He bought the fund at $25.50 a share, and it now trades at $26.30. Last year, the fund paid dividends of $0.72 a share and had capital gains distributions of $2.50 a share. Assume that the mutual fund distributed the dividends and capital gains at the end of the year. Using the approximate yield formula, what rate of return did Eric earn on his investment? Round the answer to two decimal places. % Repeat the calculation using a handheld financial calculator. Round the answer to two decimal places. % What rate of return would he have earned if the stock had risen to $30 a share? Round the answer to two decimal places. %