Question
The stock market returns 6.50% per year for 10 years. During this time, an actively managed mutual fund has earned 6.00% per year and a
The stock market returns 6.50% per year for 10 years. During this time, an actively managed mutual fund has earned 6.00% per year and a passive ETF has exactly matched the markets return. The active fund charges a 1.00% annual fee, which is used to pay for the research and the salaries of the portfolio management team that selects stocks. The passive ETF charges a 0.15% annual fee, which is sufficient to cover the ETF's minimal trading costs. If you invested to $900 in each fund at the beginning of the 10-year period, what are the ending values of your investment in each fund? Round your answers to the nearest cent.
Active fund ending balance: $
Passive ETF ending balance: $
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