. Impacts of Costs on Returns. A mutual fund has a 1.6% expense ratio and begins with a $124.655 NAV. It experiences the annual returns shown below. What are the end-of-year NAVS after fees for each year? What are the after-fee returns each year? (LO 4-4) Money to Invest NAV Expense ratio Year 1 return Year 2 return Year 3 return Year 4 return Year 5 return $ 10,000.00 $ 124.655 1.6% 5% -12% 18% 4% 23%

Essentials Of Investments
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ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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7. Impacts of Costs on Returns. A mutual fund has a 1.6% expense ratio and begins
with a $124.655 NAV. It experiences the annual returns shown below. What are the
end-of-year NAVS after fees for each year? What are the after-fee returns each year?
(LO 4-4)
Money to Invest
NAV
Expense ratio
Year 1 return
Year 2 return
Year 3 return
Year 4 return
Year 5 return
$ 10,000.00
$ 124.655
1.6%
5%
-12%
18%
4%
23%
Transcribed Image Text:7. Impacts of Costs on Returns. A mutual fund has a 1.6% expense ratio and begins with a $124.655 NAV. It experiences the annual returns shown below. What are the end-of-year NAVS after fees for each year? What are the after-fee returns each year? (LO 4-4) Money to Invest NAV Expense ratio Year 1 return Year 2 return Year 3 return Year 4 return Year 5 return $ 10,000.00 $ 124.655 1.6% 5% -12% 18% 4% 23%
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