All categories

3 years ago

An open-end fund has a net asset value of $10.70 per share. It is sold with a front-end load of 6%. What is the offering price?

Business

1 answer:

Natali5045456 [20]3 years ago

7 0

Answer:

$11.38

Explanation:

For this specific asset, it can be calculated that the offering price is $11.38 . That is because the offering price includes a 6% front-end load, this means that for every dollar that is paid only $0.94 actually goes to the purchase of the share. Therefore we can do the following calculations ...

$10.07 / (1 - 0.06) = $11.38

Making the final offering price $11.38

You might be interested in

The relationship between financial leverage and profitability Pelican Paper, Inc., and Timberland Forest, Inc., are rivals i

mamaluj [8]

Answer:

Pelican's debt ratio 9%

Timberland's debt ratio 50%

The times interest earned ratio for Pelican 57.5

The times interest earned ratio for Timberland 10.45

C is correct as Pelican has 57.5 times interest earned ratio while Timberland only 10.45 times.in other words,earnings of Timberland is more volatile.

D is also correct ,since it has financial leverage of 50.46% as against Pelican financial leverage of 9.17%

The operating margin for Pelican is 14.76% while the operating margin for Timberland is 13.8%

Return on total assets for Pelican is 36.9% and that of its competitor is 34.5%

The return on equity for Pelican 40.6% and that of Timberland is 69.6%

C is correct as Pelican is more profitable than Timberland as shown by the higher net profit margin and return on assets

B is correct, even though Pelican is more profitable (higher net profitmargin), Timberland has a higher ROE than Pelican due to the additional financial leverage risk.

Explanation:

All of the ratios requested for are found in the attached spreadsheet.

Download xlsx

3 0

3 years ago

5-7 Short Run versus Long Run A firm sells 1,000 units per week. It charges $70 per unit, the average variable costs are $25, an

irina1246 [14]

<u>a. The firm should carry out the activities. </u>

<u>b.The firm should carry out activities until it is covering the cost. </u>

<u>c. The firm should shut down business activities when the price of the product goes below $25 in short-run. </u>

<u>d. The firm should shut down business activities when the price of the product goes below $65 in long-run. </u>

Further Explanation:

Steps taken by the firm in the long run:

The sales price of the product is $70. The total average cost of the product is $65. The firm can cover all its costs (variable and fixed) and generating a profit of $5. So it should continue to carry out its business operations in the short run.

Steps taken by the firm in the long run:

In the long run, all the costs of the firm are variable. In the current case, the fixed cost is around 60% of the total cost. So the firm should attempt to decrease this cost. If the firm can decrease the total cost, it should carry out the business activities. The firm can continue to carry out the operational activities until it is making the profit and covering all the product cost.

The appropriate price for shutting down the business in the short-run:

The firm can shut down the business in the short-run when the price of the product is below $25.

In the short run, the firm can only control the variable cost. The firm can not control the fixed cost of the product. In the given case, the variable cost of the product is $25. Therefore, the firm should shut down the business when the price of the product goes below the variable cost ($25).

The appropriate price for shutting down the business in the long-run:

The firm can shut down the business in the long-run when the price of the product is below $65.

In the long run, the firm can influence all the costs of the business. It can influence the variable cost and the fixed cost of the business. Therefore, it should cover the total cost of the product. Thus, the firm should shut down the business when the price of the product goes below the total cost ($65).

Learn more:

1. Learn more about the variable costing

brainly.com/question/9203162

2. Learn more about the overhead expenses

brainly.com/question/4612804

3. Learn more about the cost of the product

brainly.com/question/1757741

Answer details:

Grade: Senior School

Subject: Economics

Chapter: Decision making (Short-run & Long-run)

Keywords: Short Run, Long Run, sells, units, week, charges, average variable costs, average costs, long run, Why, price, consider, shutting down the long run.

6 0

4 years ago

The number of deaths due to poisoning in country A in a year (25 comma 200) is _____ percent greater than the number of death

11Alexandr11 [23.1K]

Answer:

17.76

Explanation:

Deaths due to poisoning: P = 25,200

Deaths due to falls: F = 21,400

The percentage difference between the number of deaths due to poisoning and deaths due to fall is given by:

$\%D =\frac{P-F}{F}\\\%D =\frac{25,200-21,400}{21,400}=0.1776=17.76\%$

The number of deaths due to poisoning is 17.76 percent greater than the number of deaths due to falls.

8 0

3 years ago

When bonds are issued at a discount and the effective interest method is used for amortization, at each subsequent interest paym

Sladkaya [172]

Question Completion:

A. More than the effective interest.

B. Less than the effective interest.

C. Equal to the effective interest.

D. More than if the bonds had been sold at a premium

Answer:

When bonds are issued at a discount and the effective interest method is used for amortization, at each subsequent interest payment date, the cash paid is:

B. Less than the effective interest.

Explanation:

This cash payment is the product of the bond's face value multiplied by the coupon rate. The interest expense is increased by the amortized portion of the discount for the particular period. This means that the interest expense will be higher than the cash payment for interest because of the discount granted at issuance. And the interest expense is the product of the outstanding debt multiplied by the effective interest rate.

8 0

3 years ago

in addition to sanctions imposed by the maryland real estate commission, serious violations of real estate license laws can resu

DanielleElmas [232]

Both you and your broker might be penalized for significant offenses when they were known to them, and both of you could have your licenses suspended or revoked.

<h3>If you are found guilty of a significant offense in Pennsylvania and it is discovered that your broker knew about it, what is the worst-case scenario?</h3>

Both you and the broker might get fines and have your licenses revoked or suspended.

<h3>What is the maximum fine that the Maryland real estate commission will impose?</h3>

The most severe penalty will consist of a real estate license being revoked and a hefty fine exceeding $10,000. This could occur if a Maryland real estate broker collects rental income on the client's behalf but does not give the client access to the funds.

To Know more about penalized

brainly.com/question/15055317

#SPJ4

5 0

1 year ago