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(7) The formula for approximate yield of an investment can look intimidating, but it's just a function of three things: (1) dividends earned, (2) capital

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(7) The formula for approximate yield of an investment can look intimidating, but it's just a function of three things: (1) dividends earned, (2) capital gains distributions received, and (3) change in share price. Based on the information in the table, compute the approximate yield for each of the two funds that follow. Mutual Fund 1 Mutual Fund 2 Annual dividends and capital gains distributions $1.10 $2.80 Beginning mutual fund share price $60 $107 Ending mutual fund share price $81 $143 The approximate yield for Mutual Fund 1 is......... and the approximate yield for Mutual Fund 2 is......... True or False: If both investments carry the same rate of risk, Mutual Fund 1 is a better investment than Mutual Fund 2. True False

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