Question

The Capitalist Mutual Fund's portfolio is valued at $77.7 million. The fund has liabilities of $5.5 million, and the investment company sponsoring the fund has issued 1,900,000 shares. What is the fund's net asset value (NAV)? (Round your answer to 2 decimal places.) Multiple Choice
A $34.42 NAV per share
B. $43.79 NAV per share
C. $76.00 NAV per share
D. $38.00 NAV per share
E. $85.58 NAV per share

Answer 1

Answer:

The answer is D. $38.00 NAV per share.

Explanation:

Please find the below for detailed explanations and calculations:

We have the net asset value of a Fund is equal to its Market Value taken way its liabilities.

Thus, for Capitalist Mutual Fund's portfolio, the total net asset value= Total market valued - Total Liabilities = 77,700,000 - 5,500,000 = $72,200,000.

Net asset value per share = Total net asset value / Total number of outstanding share = 72,200,000/1,900,000 = $38.00 NAV per share.

Thus, the answer is D. $38.00 NAV per share.