14 You purchased 1000 shares of the New Fund at a price of 3

14. You purchased 1,000 shares of the New Fund at a price of $35 per share at the beginning of the year You padahot end load of 4% The searoes n which the ud i vests ncrease nmn by 12% ding the year. The trestpense rato is 1,2% What is your rate of reum on the fund ifyou sell your shares at the end of the year? (Do not round intermediate calculations. Round your answer to 2 decinal places. Onth\'%\" sign in your 20 2 3 4 caps lock

Solution

P0= (NAV0× Shares)/(1 – FL)

P0 = (35 × 1,000)/(1 -0.04) = $36,458.3333

P1 = 35,000 ( 1 + Investment return - expense ratio)

P1 = 35,000 ( 1 + 0.12 - 0.012)

P1 = $38,780

Rate of return = (  38,780 / 36,458.3333) - 1

Rate of return = 1.06368 - 1

Rate of return = 6.37