Question

64. You purchased shares of a mutual fund at a price of $20 per share at the beginning of the year and paid a front-end load of 5.75%. If the securities in which the fund invested increased in value by 11% during the year, and the fund's expense ratio was 1.25%, your return if you sold the fund at the end of the year would be

A. 4.33%.

B. 3.44%.

C. 2.45%.

D. 6.87%.

{[$20 × **0.9425** × (1.11 – 0.0125)] –$20}/$20 =
3.44%.

Can you explain where 0.9425 came from? I

Answer #1

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You purchased shares of a mutual fund at a price of $20 per
share at the beginning of the
year and paid a front-end load of 6.0%. If the securities in
which the fund invested
increased in value by 10% during the year, and the fund's
expense ratio was 1.5%, your
return if you sold the fund at the end of the year would be
a. 1.99%
b. 2.32%
c. 1.65%
d. 2.06%
e. None of the options are correct

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you invested $2000 in a mutual fund with a front- end load of
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