Question
A mutual fund has 300 shares of General Electric, currently trading at $22, and 400 shares of Microsoft, Inc., currently trading at $28. The fund
A mutual fund has 300 shares of General Electric, currently trading at $22, and 400 shares of Microsoft, Inc., currently trading at $28. The fund has 1,000 shares outstanding.
A. What is the NAV of the fund?
| B. If investors expect the price of General Electric to increase to $26 and the price of Microsoft to decline to $20 by the end of the year, what is the expected NAV at the end of the year? C. Assume that the price of General Electric shares is realized at $26. What is the maximum price to which Microsoft can decline and still maintain the NAV as estimated in (a)? |
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The Public Private Partnership Handbook
Authors: Malcolm Morley
1st Edition
0749474262, 978-0749474263
