Problem

Loaded-Up Fund charges a 12b-1 fee of 1.0% and maintains an expense ratio of .75%. Econo...

Loaded-Up Fund charges a 12b-1 fee of 1.0% and maintains an expense ratio of .75%. Economy Fund charges a front-end load of 2%, but has no 12b-1 fee and an expense ratio of .25%. Assume the rate of return on both funds’ portfolios (before any fees) is 6% per year. How much will an investment in each fund grow to after:

a. 1 year

b. 3 years

c. 10 years

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Solutions For Problems in Chapter 4