1. A fund is expected to earn 12% while the SPDR is expected to earn 9%. Assume the SPDR has no transaction or tracking costs and that the two funds have comparable risk. Given the MER of the fund is 2% of assets under management (AUM) at year start, what is the maximum combined feeds on the ISC/DSC of the fund such that an investor would still prefer it over the SPDR?

1. Cannot be computed with the information provided
2. 2%
3. 100 bps
4. 0%
5. -1%