The World Income Appreciation Fund has current assets with a market value of $12

Question

The World Income Appreciation Fund has current assets with a market value of $12.8 billion, 430 million shares outstanding, and a current market price quotation of $31.24. Calculate the front-end load. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

The World Income Appreciation Fund has current assets with a market value of $12.8 billion, 430 million shares outstanding, and a current market price quotation of $31.24. Calculate the front-end load. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. Omit the "%" sign in your response.)

Explanation / Answer

Calculation of front end load -

NAV= $12.8 billion/ 430 million shares= $12.8*1000 million/ 430 million shares= $29.77
If the current quote is $31.24

29.77 + x% * 29.77= 31.24
=> 29.77 + 0.2977x= 31.24
=> 0.2977x= 31.24- 29.77
=> x= 4.94%
Thus, the front end load= 4.94

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