Question
Max and Brooke each invest $500 into stock market funds. Max invests in a passively managed fund with a 0.04% expense ratio; ignoring fees, this
Max and Brooke each invest $500 into stock market funds. Max invests in a passively managed fund with a 0.04% expense ratio; ignoring fees, this fund earns 9.4% annual interest. Brooke invests in an actively managed fund with a 0.7% expense ratio. Ignoring fees, this fund earns 9.9% interest. Which of the following statements is correct?
Question 3 options:
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a. After 50 years, Max will have $3,094.89 more than Brooke
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b. After 50 years, Brooke will have $3094.89 more than Max
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c. After 50 years, Max will have $11,449.78 more than Brooke
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d. After 50 years, Brooke will have $11,449.78 more than Max
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e. None of the above.
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Mathematics Of Finance
Authors: Petr Zima, Robert L. Brown
5th Edition
0070871353, 978-0070871359
