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USPshnik [31]
4 years ago
9

A closed-end fund has total assets of $379 million and liabilities of $640,000. There are 36 million shares outstanding. What is

the premium or discount if the shares are currently selling for $9.85 each?
Business
1 answer:
Alenkasestr [34]4 years ago
7 0

Answer:

discount % is 6.28 %

Explanation:

given data

total assets = $379 million

liabilities = $640,000

shares outstanding = 36 million

currently selling = $9.85

solution

we get here Net assets that is express as

Net assets = total assets - total liability ................1

Net assets = 379000000 - 640000

Net assets = 378360000

and

net assets per share will be = \frac{378360000}{36000000}

net assets per share  = $10.51 per share

and now price is $9.85

so premium will be = \frac{9.85-10.51}{10.51} × 100

premium  = - 6.28%

here negative show discount

so discount % is 6.28 %

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