The European Growth Fund has $920 million in assets and $68,000 in liabilities. There are 29.6 million shares outstanding. The fund charges a 4.5 percent front-end load. What is the offering price?

Question

Quizplus · Accepted Answer

To find the offering price, first calculate the net asset value (NAV) per share: (Assets - Liabilities) / Shares = ($920,000,000 - $68,000) / 29,600,000 = $31.08. Then, adjust for the front-end load: NAV / (1 - Load) = $31.08 / (1 - 0.045) = $32.54.

The European Growth Fund Has $920 Million in Assets and $68,000