Question

City Street Fund has a portfolio of $484 million and liabilities of $14 million. a. If...

City Street Fund has a portfolio of $484 million and liabilities of $14 million.

a. If there are 94 million shares outstanding, what is net asset value?

Net asset value            $

b-1. If a large investor redeems 4 million shares, what happens to the portfolio value? (Enter your answer in millions.)

Portfolio value (Click to select)increases decreases to $  million.

b-2. If a large investor redeems 4 million shares, what happens to shares outstanding? (Enter your answer in millions.)

Shares outstanding (Click to select)increases decreases to  million.

b-3. If a large investor redeems 4 million shares, what is net asset value?

Net asset value            $

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Homework Answers

Answer #1

A. Net assest value = net worth / shares outstanding = [$484million - $14million] / 94 million = $5 per share.

B 1 . Net potfolio value = $484 million - (4million * $5) = $464million i.e. is Decrease to $464million

B 2 . New share outstanding = 94 million - 4 million = 90 million i.e. Decrease to 90 million

B 3 . Net assest value = net worth / shares outstanding = [$464million - $14million] / 90 million = $5 per share

For any clarification comment.

Please thumps up, Thank you

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