A mutual fund has 600 shares of General Electric, currently trading at $14, and 600 shares of Microsoft, Inc., currently trading at $27. The fund has 1,500 shares outstanding.
a. What is the NAV of the fund? (Round your answer to 2 decimal places. (e.g., 32.16))
NAV $
b. If investors expect the price of General Electric to increase to $20 and the price of Microsoft to decline to $14 by the end of the year, what is the expected NAV at the end of the year? (Round your answer to 2 decimal places. (e.g., 32.16))
Expected NAV $
c. Assume that the price of General Electric shares is realized at $20. What is the maximum price to which Microsoft can decline and still maintain the NAV as estimated in (a)? (Do not round intermediate calculations.)
Maximum price $
A mutual fund has 600 shares of General Electric, currently trading at $14, and 600 shares of Microsoft, Inc., currently trading at $27. The fund has 1,500 shares outstanding.
| a. | What is the NAV of the fund? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| NAV | $ |
| b. | If investors expect the price of General Electric to increase to $20 and the price of Microsoft to decline to $14 by the end of the year, what is the expected NAV at the end of the year? (Round your answer to 2 decimal places. (e.g., 32.16)) |
| Expected NAV | $ |
| c. | Assume that the price of General Electric shares is realized at $20. What is the maximum price to which Microsoft can decline and still maintain the NAV as estimated in (a)? (Do not round intermediate calculations.) |
| Maximum price | $ |
Related questions
| An open-end mutual fund has the following stocks: |
| Stock | Shares | Stock Price |
| A | 9,500 | $91 |
| B | 33,000 | 20 |
| C | 10,000 | 75 |
| D | 68,000 | 13 |
There are 57,000 shares of the mutual fund, and liabilities of$150,000. What is the NAV of the fund? (Do not roundintermediate calculations. Round your answer to 2 decimal places.Omit the "$" sign in your response.) |
| Net asset value | $ |
| An open-end mutual fund has the following stocks: |
| Stock | Shares | Stock Price |
| A | 13,500 | $83 |
| B | 33,000 | 16 |
| C | 20,000 | 59 |
| D | 71,000 | 21 |
| There are 65,000 shares of the mutual fund, and liabilities of $215,000. What is the NAV of the fund? (Do not round intermediate calculations. Round your answer to 2 decimal places. Omit the "$" sign in your response.) |
| Net asset value | $ |
