How Is a Mutual Fund's Expense Ratio Calculated

question 49

Multiple Choice

How is a mutual fund's expense ratio calculated?

• A)Total operating expenses
• B)Total operating expenses for year/12 months
• C)Total operating expenses divided by average dollar value of the fund's assets
• D)Average monthly operating expenses divided by average asset value

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Definitions:

Real Value

The value of an object or service adjusted for inflation, representing its purchasing power.

Nominal Value

The face value of a financial instrument or an item's price in terms of money, without adjustment for inflation or other factors.

Price Level

The ongoing average price for the economy's produced goods and services.

Consumer Price Index

An indicator that calculates the weighted mean of the cost of a collection of consumer products and services, including transportation, food, and healthcare, employed to gauge inflation rates.