Use these Calculations to answer the question below: As the price of a close-end fund may deviate from its NAV, we instead use the price of the net asset value when we calculate the rate of return: a. Start of year price = $16.00 (1 + 0.03) = $16.48 End of year price = $16.50 (1 0.08) = $15.180 Although NAV increased, the price of the fund fell by $1.300. rate of return = ((Price) + Distributions) Start of year price = ($1.300 + $1.90) $16.48 = 0.0364 = 3.64% b. An investor holding the same portfolio as the fund manager would have earned a rate of return based on the increase in the NAV of the portfolio: rate of return = ((NAV) + Distributions) Start of year NAV = ($16.50 $16.00 + $1.90) $16.00 = 0.1500 = 15.00% A closed-end fund starts the year with a net asset value of $21. By year-end, NAV equals $22.00. At the beginning of the year, the fund is selling at a 2% premium to NAV. By the end of the year, the fund is selling at a 7% discount to NAV. The fund paid year-end distributions of income and capital gains of $2.40. Required: What is the rate of return to an investor in the fund during the year? Note: Do not round intermediate calculations. Round your answer to 2 decimal places. What would have been the rate of return to an investor who held the same securities as the fund manager during the year? Note: Round your answer to 2 decimal places