Question

Chip, a true romantic, gives his girlfriend money on the condition she buy 100 shares of a mutual fund for Valentine’s Day. The fund net asset value is $10. The fund charges a load fee of 5.5%. During the year the mutual fund distributes $0.75 in dividends. A year later, she breaks up with Chip and wants nothing to do with him. She sells the shares for a net asset value of $12.03 and the fund does not charge and exit fee. What percentage return did she earn on her investment?

Answer 1