Sarah Mix decides to invest $500 per month in three funds, with $200 going into
ID: 2742339 • Letter: S
Question
Sarah Mix decides to invest $500 per month in three funds, with $200 going into a small capital growth fund, $150 going into a large capital growth fund, and $150 into an international fund. She tracked the price she paid for stock in these funds over a 6-month period, as shown in the table below.
a. What was the average price paid per share in each mutual fund?
b. How much has Sarah invested in mutual funds?
c. What is the current value of her investment?
d. Which fund is currently performing best for Sarah?
Month
Large Cap
Small Cap
International
1
35.45
27.00
29.00
2
32.35
27.25
28.50
3
28.36
26.55
28.00
4
32.15
28.00
28.25
5
33.12
28.50
28.75
6
35.00
27.60
29.00
Month
Large Cap
Small Cap
International
1
35.45
27.00
29.00
2
32.35
27.25
28.50
3
28.36
26.55
28.00
4
32.15
28.00
28.25
5
33.12
28.50
28.75
6
35.00
27.60
29.00
Explanation / Answer
a. Average price of large Cap mutual fund = (35.45+32.35+28.36+32.15+33.12+35)/6 = 32.74
Average price for small Cap fund = (27+27.25+26.55+28 +28.50+27.60)/6 = 27.48
Average price for International funs = (29+28.50+28+28.25+28.75+29) = 28.58
b. Sarah invested a total of $500 for 6 months so her total investment = 500*6 = 3000
c. Total investment in large cap fund = 150* 6 = 900. So her current value in large cap = 900/32.74 * 36 = 962.13
Total investment in small cap fund = 200* 6 = 1200. So her current value in small cap = 1200/27.48*27.60 = 1,205.24
Total investment in international fund = 150*6 = 900. So her current value in international funds = 900/28.58*29 = 912.23
d. From the above, th best performing fund for Sarah is the large cap fund
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.