Loaded-Up Fund charges a 12b-1 fee of 1% and maintains an expense ratio of 0.75%. Economy...

50.1K

Verified Solution

Question

Finance

Loaded-Up Fund charges a 12b-1 fee of 1% and maintains anexpense ratio of 0.75%. Economy Fund charges a front-end load of2%, but has no 12b-1 fee and an expense ratio of 0.25%. Assume therate of return on both funds’ portfolios (before any fees) is 7%per year.
a.
How much will an investment of $100 in each fund grow to after 1year? (Do not round intermediate calculations. Round youranswers to 2 decimal places.)
  Loaded-Up Fund $
  Economy Fund $
b.
How much will an investment of $100 in each fund grow to after 5years? (Do not round intermediate calculations. Round youranswers to 2 decimal places.)
  Loaded-Up Fund $
  Economy Fund $
c.
How much will an investment of $100 in each fund grow to after12 years? (Do not round intermediate calculations. Roundyour answers to 2 decimal places.)
  Loaded-Up Fund $
  Economy Fund $

Answer & Explanation Solved by verified expert

3.6 Ratings (461 Votes)

Given that Initial investment100 Expense ratio of Loadedup fund is 075 it has 12b1 fee of 1 and has no frontend load Expense ratio of Economy fund is 025 has a frontend load of 2 and has no 12b1 fee Rate of return7 Now value See Answer

Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:

Unlimited Question Access with detailed Answers
Zin AI - 3 Million Words
10 Dall-E 3 Images
20 Plot Generations
Conversation with Dialogue Memory
No Ads, Ever!
Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!

Become a Member

Transcribed Image Text

Loaded-Up Fund charges a 12b-1 fee of 1% and maintains anexpense ratio of 0.75%. Economy Fund charges a front-end load of2%, but has no 12b-1 fee and an expense ratio of 0.25%. Assume therate of return on both funds’ portfolios (before any fees) is 7%per year.a.How much will an investment of $100 in each fund grow to after 1year? (Do not round intermediate calculations. Round youranswers to 2 decimal places.) Loaded-Up Fund$ Economy Fund$ b.How much will an investment of $100 in each fund grow to after 5years? (Do not round intermediate calculations. Round youranswers to 2 decimal places.) Loaded-Up Fund$ Economy Fund$ c.How much will an investment of $100 in each fund grow to after12 years? (Do not round intermediate calculations. Roundyour answers to 2 decimal places.) Loaded-Up Fund$ Economy Fund$