Open-end fund A owns 100 shares of AT&T valued at $100 each and 50 shares of Toro valued at $50 each. Closed-end fund B owns 75 shares of AT&T and 100 shares of Toro. Each fund has 100 shares of stock outstanding.

a. What are the NAVs of both funds using these prices?

b. Assume that in one month the price of AT&T stock has increased to $105 and the price of Toro stock has decreased to $45. How do these changes impact the NAV of both funds? If the funds were purchased at the NAV prices in

(a) and sold at month end, what would be the realized returns on the investments?

c. Assume that another 100 shares of AT&T are added to fund A. What is the effect on fund A's NAV if the stock prices remain unchanged from the original prices?