Consider a no-load mutual fund with $390 million in assets and 15 million shares at the start of the year and with $440 million in assets and 16 million shares at the end of the year. During the year investors have received income distributions of $2 per share and capital gain distributions of $.30 per share. Assuming that the fund carries no debt, and that the total expense ratio is 2%, what is the rate of return on the fund?

12.06%

The answer cannot be determined from the information given.

27.25%

12.50%