On January 2, 2003, You Invest $10,000 in the Tiger

question 95

Multiple Choice

On January 2, 2003, you invest $10,000 in the Tiger Fund, a load fund that charges a fee of 6%. The fund's returns were 25% in 2003, 35% in 2004, -5% in 2005. On December 31, 2005 you redeem all your shares of Tiger. The dollar value is

• A)$5,200.89
• B)$13,345.89
• C)$7,931.25
• D)$15,896.34
• E)$8,646.91

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Definitions:

Arbitrary Value

An arbitrary value is a value assigned based on discretion or judgment rather than from an objective calculation or measurement.

Project Measurement

The process of quantifying the performance and progress of a project against predefined benchmarks.

Internal Rate of Return

A financial metric used to evaluate the profitability of potential investments, representing the annual return rate that makes the net present value of cash flows from a potential investment equal to zero.

Capital Budgeting

The process businesses use to evaluate and select long-term investments that are expected to yield the most beneficial returns.