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Suppose that for a mutual fund, NAV per share is $35 and there are 10 shares outstanding. After market closing suppose a news is realized

Suppose that for a mutual fund, NAV per share is $35 and there are 10 shares outstanding. After market closing suppose a news is realized that would drive NAV per share to $40.

a) What is the return for the existing investors? b) A market timer/late trader knows about the news and buys 1 share at $35. What is the new overall NAV and NAV per share? Compute the return for old investors.

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