Mutual funds can be classified basing on execution and operations or basing on yield and

investment pattern, briefly describe the classification of mutual funds from these two basis

$28.$ With examples, briefly discuss the importance of mutual funds to an economy

$29.$ Akiba Unit Trust Fund has a prospective average annual return of $8\%$ over the next $20$ years.

Estimate the value of a Tshs $20,000,000$ investment after $20$ years when the returns are

i$.$ Tax$-$free, $(3$ Marks$)$ ii$.$ Subject to a

deferred tax of $30\%$ iii. Subject to an

annual tax of $25\%$

$30.$ Briefly analyze the difference between defined benefit plan and defined contribution plan as

applied in the pension funds

$31.$ Mr Domokaya works as Director of finance in TPL Ltd a publicly owned institution where He

earns a salary of Tshs $6,000,000$ per month. Mr Domokaya expects to hold that position for the

next $40$ years before retirements. After retirement, Mr Domokaya expects to live for further $30$

years. Mr Domokaya wishes to make saving into a pension fund as preparation for his

retirement and expects a zero real interest $($interest net of inflation$).$

Required

i$.$ How much Mr Domokaya should save in the pension fund for a retirement of $2/3$rd of his

current income? ii$.$ If Mr Domokaya is expecting a real rate of interest of $10\%$ p$.$a$.$ what would

be the required annual savings