Pregunta
Which of the following describes how to calculate the total investment in a load fund? a. Multiply the number of shares by the net asset value. b. Multiply the number of shares by the offer price. c. Subtract the net asset value from the offer price. d. Subtract the proceeds from the investments. Please select the best answer from the choices provided
Ask by Hall Crawford. in the United States
Feb 04,2025
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To calculate the total investment in a load fund, multiply the number of shares by the offer price.
Solución
The correct way to calculate the **total investment** in a load fund is by multiplying the **number of shares** by the **offer price**.
Here's why:
- **Offer Price**: This is the price you pay when purchasing shares of a load fund, and it typically includes the **sales charge (load)**. Therefore, multiplying the number of shares by the offer price gives you the **total amount invested**, including any fees.
- **Net Asset Value (NAV)**: This represents the per-share value of the fund's assets but **excludes** any sales charges. Using NAV alone would not account for the load fee.
**Correct Answer:**
**b. Multiply the number of shares by the offer price.**
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Simplifique esta solución The Deep Dive
The best answer is: a. Multiply the number of shares by the net asset value. When you're calculating your total investment in a load fund, you take the total number of shares you own and multiply it by the net asset value (NAV). This gives you a clear picture of how much your investment is worth based on the current value of the fund's underlying assets! Investing in load funds comes with extra costs known as sales loads that can affect your total return. So, always ensure to account for those fees when you're analyzing your investment, as they can eat into your gains! Staying informed about these charges helps you make smarter investment choices in the long term.
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