(A) Adequate Information: The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1% To calculate: Net asset value for the investor at the beginning and the year end Introduction: Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

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Answer 1

Question

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

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Consider a mutual fund with $200 million in assets at the start of the year and 10 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $2 million. The stocks included in the fund’s portfolio increase in price by 8%, but no securities are sold and there are no capital gains distributions. The fund charges 12b-1 fees of 1%, which are deducted from portfolio assets at year-end. What is the fund’s net asset value at the start and end of the year? What is the rate of return for an investor in the fund?

Consider a mutual fund with $200 million in assets at the start of the year and with 10 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $2 million. The stocks included in the fund's portfolio increase in price by 8%, but no securities are sold, and there are no capital gains distributions. The fund charges 12b-1 fees of 1%, which are deducted from portfolio assets at year-end. Required: a. What is the net asset value at the start and end of the year? (Enter your answers in dollars rounded to 3 decimal places.) Start of the year End of the year Net Asset Value Rate of return b. What is the rate of return for an investor in the fund? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Per share Per share %

Consider a mutual fund with $250 million in assets at the start of the year and 10 million shares outstanding. The fund invests in a portfolio of stocks that provides dividend income at the end of the year of $2.2 million. The stocks included in the fund's portfolio increase in price by 6%, but no securities are sold and there are no capital gains distributions. The fund charges 12b-1 fees of 1.00%, which are deducted from portfolio assets at year-end. a. What is the fund's net asset value at the start and end of the year? (Round "End of the year" to 3 decimal places.) b. What is the rate of return for an investor in the fund? (Round your intermediate calculations to 3 decimal places and final answer to 2 decimal places.)

Answer 2

Question

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

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Answer 3

Question

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

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Answer 4

Question

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

Expert Solution & Answer

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Answer 5

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

Answer 6

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Answer 7

Chapter 4, Problem 15PS

Summary Introduction

(A)

Adequate Information:

The mutual fund total in the beginning of the year is $200 million. The shares outstanding are 10 million. The dividend income accounts for $2 at the year end. The increase in price of fund portfolio takes place by 8%. The 12b-1 fees charged by the fund accounts for 1%

To calculate:

Net asset value for the investor at the beginning and the year end

Introduction:

Net asset value is ascertained by subtracting the total value of liabilities from the total value of asset of any entity. It reflects the net value of a particular entity at a particular point of time. It is generally used in context of exchange traded funds and mutual funds.

Answer 8

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

Answer 9

Summary Introduction

(B)

To calculate:

Net rate of return on the fund for the investor

Introduction:

Rate of return refers to the ratio of loss or profit ascertained in the financial year with respect to the investment which is generally expressed in percentage of decrease or increase in the investment's value during the given period of time.

Answer 10

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Answer 11

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Answer 12

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Answer 13

Ch. 4 - Prob. 1PS Ch. 4 - Prob. 2PS Ch. 4 - Prob. 3PS Ch. 4 - Prob. 4PS Ch. 4 - Prob. 5PS Ch. 4 - Prob. 6PS Ch. 4 - Prob. 7PS Ch. 4 - Prob. 8PS Ch. 4 - Prob. 9PS Ch. 4 - Prob. 10PS

Solution Summary: The author calculates the net asset value for the investor at the beginning of the year and the end of year.

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Chapter 4 Solutions