BUSINESS MATH Exam 3-Continued Billy invested S9.102 in a Type \"B\" ACE Mutual
ID: 2714204 • Letter: B
Question
BUSINESS MATH Exam 3-Continued Billy invested S9.102 in a Type "B" ACE Mutual Fund with a 1% loading rate back-loaded. The NAV was S11.10 per share when he invested. Billy sold at a NAV of $11.97. How much profit (loss) did Billy make on the investment? 23. Prudence purchases three municipal $30,000 bonds at a price of 90. The bonds pay annual interest at a rate of 2.76%, what is the annual yield for Prudence's bonds? 24. 25. Maggie Mae bought a two-unit town house on Lime Street for $500,000 to use as a rental property for vacationers. She made a $50,000 down payment. Maggie's annual expenses on the house are mortgage interest of $20.49953. depreciation of 2.5% of the purchase price, taxes of $6,000, and other miscellaneous costs, such as repairs, of $5,000. Assuming Maggie is able to keep each of her units rented out all 12 months of the year, what should she rent each unit for if she hopes to earn a 12% annual yield? 26. Beethoven Lucielle began saving $2,000 per year in his Roth IRA at the age of 22. At the age of 35, he increased his savings rate to $3.500 per year. He invested the money in a variety of products including stocks, bonds, and CDs. When he was 50 years old, Beethoven made a $10,000 withdrawal to take a vacation. Now at the age of 75, Beethoven's IRA has a fair market value of $343,930 and his life expectancy factor is 22.9. If he fails to take his distribution this year, what will Beethoven's penalty be? FILL IN YOUR NAME AND THE OTHER REQUIRED INFORMATION ON EACH PAGE OF THE EXAM AND MAIL THE EXAM TO AMERICAN SCHOOL 24Explanation / Answer
23)
Number of units purchased:
= $9,102÷$11.10
= 820 units
Sale proceeds from sale of units:
= 820×$11.97-1%
= $9,717.25
Profit on investment:
= $9,717.25-$9,102
= $615.25
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