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Suppose an open-ended mutual fund contains 200 shares of Toyota currently trading at $140, 5,000 shares of Ford currently trading at $10, and 800 shares
Suppose an open-ended mutual fund contains 200 shares of Toyota currently trading at $140, 5,000 shares of Ford currently trading at $10, and 800 shares of General Motors currently trading at $40. The mutual fund has 5,000 shares outstanding. During the day, 1000 new shares of the fund are purchased, and the fund manager invests the total proceeds into Honda at $25 per share. Suppose Toyota is $135 per share, Ford is $12 per share, General Motors is $38 per share, and Honda is $30 per share at the end of the day.
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SOLUTION Toyota Originally 200 shares at 140 per share 28000 Now 20...
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Financial Markets and Institutions
Authors: Anthony Saunders, Marcia Cornett
6th edition
9780077641849, 77861663, 77641841, 978-0077861667
