You have $5,000 to invest You are comparing two investment funds. Fund A returns 4%/yr compounded monthly Fund B returns 4.05% compounded quarterly. Which should you choose and why?
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A: Mutual fund have expenses that reduces the overall return on the mutual fund.
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A: Hurdle rate: It is the minimum return that is required by an investor on an investment project.
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A: Future value is the accumulated value of a sum of money at a future date. Future value is calculated…
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A: Calculation of Future Value and Present Value:Excel Spreadsheet:
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A: Rate = 5.25% Monthly rate (I/Y) = 5.25/12 = 0.437500 Amount available (PV)…
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A: Given, For loaded-up funds: The 12-b1 fee is 1.00% Expense ratio is 0.5%. For economy funds: Front…
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A: Investment amount = $1000 Interest rate is divided semi annually First half year, Interest rate = 8%…
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A: Annuity value is calculated by taking series of cash inflows over the period of time with interest…
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A: Commission =6%Investment=$20000Commission=$20000×6%=$1200Number of period=9 yearsFuture…
Q: 2. If $14,000 had been invested in the Fictious Fund on June 30, 1995, then on June 30, 2005 the…
A: “Hey, since there are multiple questions posted, we will answer first question. If you want any…
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A: Solution:- When an equal amount is receivable each period, it is called annuity. So, present value…
Q: 23. Funds XYZ and ABC have the following as shown below. If you will invest $50,000 and expect a…
A: Answer: B & C Solution: Value of Investment = Investment×(1-front end load)×(1+r-true expense…
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A: Rate of return represents the gain or loss in terms of percentage which an investor is expected to…
Q: In its first 10 years a mutual fund produced an average annual return of 19.17%. Assume that money…
A: Future value is the total amount of money at a specified point of time.
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Q: Jimmy deposits $4,000 now, $2,500 3 years from now, and $5,000 6 years from now. Interest is 5% for…
A: a)How much money will be in the fund at the end of 6 years:
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A: The purchasing power will be the future value of the cash flows at the market rate of interest and…
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A: The time period or the number of years (NPER) refers to the time it would require for the investment…
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A: The process involving setting aside a common amount after each period in an interest generating…
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A: Closed-end funds are investment companies whose equity or ETF shares are exchanged in the free…
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A: Investments are the ways by which individuals and corporations park or save their money and funds in…
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A: The future value is the amount that will be received at the end of a certain period. In simple…
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A: Annual interest is the total interest amount calculated on annual investment made, to calculate…
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A: Compounding return is the capacity of investment to earn, on the previous earning along with the…
Q: Investing that $120,000 in a saving account for 15 years. There are two banks forher choice. Bank A…
A: Future Value = 330,000 Time Period = 15 years*12 = 180 months Interest % = 7%/12 = 0.5833333%…
Q: Your objective is to have $25,650 in exactly 15 years. Today you invest $9,000 in a Schwab…
A: Amount after 7 years=$9000×(1+rate)n Where, Rate=6.1%N=7Amount=$9000×(1.061)7=18919.85
Q: QuantAlpha fund charges a 12b-1 fee of 1% and maintains an expense ratio of 0.75%. Assume the rate…
A: Value of investment = Invested amount*(1+r)n *(1-annual charges %)n r is rate of return of fund…
Q: G. Each column in the table below is labeled, complete the table by writing the given data (in…
A: All the answers to the questions are answered using a financial calculator.
Q: 13. hat Corp. establishing a fund where they pay $200 annually (ie. every year) into the fund. The…
A: Note : It is assumed that each payment is made at starting of year.
Q: f $14,000 had been invested in the Fictious Fund on June 30, 1995, then on June 30, 2005 the…
A: Compound Interest is calculated by multiplying the initial principal amount by one plus the annual…
Q: $1,000 is invested in a fund at the beginning the year. The fund rate of return is 8% for the first…
A: The money weighted return used the IRR method of return computation, while the time weighted return…
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A: Information Provided: Present value = $10,000 Interest rate = 8% Term = 15 years Annual deposit =…
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A: Option I Present Value = $5,000 Interest Rate = 7% Time period = 27 Years Note:- Investment invested…
Q: return
A: Formulas: a) Rate of return to an investor is: (1-sale @ year end)NAV1 - (1+sale at year…
Q: Investing that $120,000 in a saving account for 15 years. There are two banks forher choice. Bank A…
A: The future value of a cash flow series is the future worth of a series of cash flows when compounded…
Q: At the beginning of each year, you deposit the following into a growthmutual fund that earns 6…
A: The present value is the value of the sum received at time 0 or the current period. It is the value…
Q: Your RRSP savings of $35,000 are converted to a RRIF at 3.25% compounded monthly that pays $5,100 at…
A: The amount in retirement fund will be depleted after some period of time due to payment and interest…
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- You are considering an investment in a mutual fund with a 5% load and an expense ratio of 0.5%. You can invest instead in a bank CD paying 3% interest. Required: a. If you plan to invest for 4 years, what annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding of returns. b. What annual rate of return must the fund portfolio earn if you plan to invest for 6 years to be better off in the fund than in the CD? c. Now suppose that instead of a front-end load the fund assesses a 12b-1 fee of 0.75% per year. What annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Note: Do not round intermediate calculations. Round your answers to 2 decimal places. a. Annual rate of return b. Annual rate of return c. Annual rate of return % % %You are considering an investment in a mutual fund with a 5% load and an expense ratio of 0.75%. You can invest instead in a bank CD paying 3% interest. Required: a. If you plan to invest for 3 years, what annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding of returns. b. What annual rate of return must the fund portfolio earn if you plan to invest for 6 years to be better off in the fund than in the CD? c. Now suppose that instead of a front-end load the fund assesses a 12b-1 fee of 0.50% per year. What annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Note: Do not round intermediate calculations. Round your answers to 2 decimal places.Suppose you consider investing $1,000 in a load fund which charges a fee of 2%, and you expect the fund to earn 14% over the next year. Alternatively, you could invest in a no-load fund with similar risk that is expected to earn 9% and charges a 1/2 percent redemption fee. Which is better and by how much? a. Funds are equal b. Load fund by $32.65 c. Load fund by $50.55 d. No-load fund by $64.55 e. No-load fund by $44.30
- An investor is evaluating the historical performance of an investment fund. The following annual returns are provided to the investor: Fund Value Year 0 $120 Year 1 132 Year 2 146 Year 3 133 Year 4 128 Year 5 123 Required: a. Calculate the investment returns for each year. b. Compute the arithmetic mean return. c. Calculate the geometric mean return.You have $10,000 to invest and you are considering investing in a fund. The fund charges a front-end load of 5.75 percent and an annual expense fee of 1.25 percent of the average asset value over the year. You believe the fund's gross rate of return will be 11 percent per year. If you make the investment, what should your investment be worth in one year? O A. $10,135.48 O B. S10,461.75 OC. $10,578.92 O D. $10,556.23 O E. $10,337.46Suppose you are considering investing $1,000 in a load fund that charges a fee of 7%, and you expect your investment to earn 13% over the next year. Alternatively, you could invest in a no-load fund with similar risk that charges a 1% redemption fee. You estimate that this no-load fund will earn 11%. Given your expectations, which is the better investment and by how much? Do not round intermediate calculations. Round your answers to two decimal places. Load fund growth: No-load fund growth: The-Select- fund is better by % % %.
- You are considering an investment in a mutual fund with a 4% load and an expense ratio of .5%. You can invest instead in a bank CD paying 6% interest.a. If you plan to invest for 2 years, what annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding of returns.b. How does your answer change if you plan to invest for 6 years? Why does your answer change?c. Now suppose that instead of a front-end load the fund assesses a 12b-1 fee of .75% per year. What annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Does your answer in this case depend on your time horizon?I NEED TO SOLVE THİS USIİNG EXCEL Suppose you invest into Fund X for 15 months with a monthly interest rate of 8%. Each month you pay $260 calculate the ending value in the red shaded area. 1 Suppose you found the Ending Value. You would like to observe the Ending Value for various monthly payments which are $100, $200, $300, and $400 Create one-way data table to see the annual payments for the interest rates in green shaded area. 2 4 5 INVESTMENTS Years Left 6 Fund X Monthly Payment ($260) Interest Rate Ending Value 15 8% 7 8 (100.00) (200.00) (300.00) (400.00) 10 $ 11 $ 12 $An investor is considering two mutual funds. Fund A has a 5.75 percent front-end load and a 1.25 percent expense ratio. Fund B is no-load but has a 2.25 percent expense ratio. If the investor plans on being in either fund for six years, which should they choose given that they have $16,000 to invest and both funds have gross returns of 12 percent per year? Fees are applied at each year-end to year-end asset values, but the load is taken out up front only once.
- Consider an investment fund that starts out with £160,000. After one year, the value of the fund is £166,000. The investor deposits an additional £19,000 to the fund. After a second year, the value of the fund is £182,000. The investor withdraws £44,000. After a third year, the value of the investment fund is worth £143,000. Compute the money-weighted rate of return 数字 Enter a percentage correct to 1 decimal place % Compute the time-weighted rate of return 数字 Enter a percentage correct to 1 decimal place %You are considering an investment in a mutual fund with a 4.5% load and an expense ratio of 0.5%. You can invest instead in a bank CD paying 3.5% interest. If you plan to invest for 5 years, what annual rate of return (i.e. gross ret) must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding.You are considering an investment in a mutual fund with a 4% load and an expense ratio of 0.5%. You can invest instead in a bank CD paying 6% interest. Required: a. If you plan to invest for two years, what annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding of returns. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Annual rate of return b. If you plan to invest for six years, what annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? Assume annual compounding of returns. (Do not round intermediate calculations. Round your answer to 2 decimal places.) Annual rate of return % Annual rate of return % c. Now suppose that instead of a front-end load the fund assesses a 12b-1 fee of 0.75% per year. What annual rate of return must the fund portfolio earn for you to be better off in the fund than in the CD? (Do not round intermediate…