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Unformatted text preview: 10-11 QUIZ 2 chap 4-7 Student name & student no.: _________________________________________________________________ 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 1. The NAV of which funds is fixed at $1 per share? A. Equity funds B. Money market funds C. Fixed income funds D. Commingled funds 2. Assume that you have recently purchased 100 shares in an investment company. Upon examining the balance sheet, you note the firm is reporting $225 million in assets, $30 million in liabilities, and 10 million shares outstanding. What is the Net Asset Value (NAV) of these shares? A. $25.50 B. $22.50 C. $19.50 D. $1.95 3. Rank the following fund category from most risky to least risky. I. Equity growth fund II. Balanced fund III. Sector fund IV. Money market fund A. IV, I, III, II B. III, II, IV, I C. I, II, III, IV D. III, I, II, IV 4. Consider a no-load mutual fund with $200 million in assets and 10 million shares at the start of the year, and $250 million in assets and 11 million shares at the end of the year. During the year investors have received income distributions of $2 per share, and capital gains distributions of $0.25 per share. Assuming that the fund carries no debt, and that the total expense ratio is 1%, what is the rate of return on the fund? A. 36.25% B. 24.90% C. 23.85% D. There is not sufficient information to answer this question 5. The offer price of an open-end fund is $18.00 and the fund is sold with a front-end load of 5%? What is the fund's NAV? A. $18.74 B. $17.10 C. $15.40 D. $16.57 6. Which of the following funds invest in stocks of fast growing companies? A. Balanced funds B. Growth equity funds C. REITs D. Equity income funds 7. With respect to mutual funds, late trading refers to the practice of ________. A. trading after the close of U.S. markets but before overseas markets have closed B. trading after the close of overseas markets, but before U.S. markets have closed C. accepting buy or sell orders after the market closes and NAV has already been determined for the day D. paying capital gains distributions to certain investors only after paying privileged investors first 8. The difference between balanced funds and asset allocation funds is that _____. A. balanced funds invest in bonds while asset allocation funds do not B. asset allocation funds invest in bonds while balanced funds do not C. balanced funds have relatively stable proportions of stocks and bonds while the proportions may vary dramatically for asset allocation funds D. balanced funds make no capital gains distributions and asset allocation funds make both dividend and capital gains distributions 9. A mutual fund has $50 million in assets at the beginning of the year and 1 million shares outstanding throughout the year. Throughout the year assets grow at 12%. The fund imposes a 12b-1 fee on all shares equal to 1%. The fee is imposed on year end asset values. If there are no distributions what is the end of year NAV for the fund?...
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- Spring '11