Given the Following Fees and Expected Returns for Fund Y

question 31

Multiple Choice

Given the following fees and expected returns for fund Y, assuming an initial investment of $1000 calculate the value of the investment at the end of 5 years $$\begin{array} { l c c c c c } \text { Investment } & \mathrm { E } \text { (Return) } & \text { Load } & 12 \mathrm {~b} - 1 \text { fee } & \text { Rear-endload } & \text { Years } \\\mathrm { Y } & 8 \% & 0 \% & 0.50 \% & 3 \% & 5 \text { years }\end{array}$$

• A)$1069.82
• B)$1550.77
• C)$1642.36
• D)$1389.95
• E)$1362.59

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Definitions:

Economic Profits

The difference between total revenue and total costs, including both explicit and implicit costs, representing additional earnings beyond the normal profit level.

Industry Entry

The process of a new competitor or company beginning operations in a particular market.

Economic Profit

Economic profit is the surplus obtained after subtracting both the explicit and implicit costs from total revenues, emphasizing the opportunity costs of resources used.

Economic Loss

A decrease in monetary value, wealth, or resources, especially as a result of business activities or market factors.