Question

which of the following expressions is equal to the total proceeds of a mutual fund?
a. net assets times number of shares
b. net asset value times number of shares
c. offer price times number of shares
d. profit minus investment

Explanation:

To determine the total proceeds of a mutual fund, we analyze each option:

• Option a: Net assets times number of shares is incorrect. Net asset value (not net assets) relates to share value.
• Option b: Net asset value (NAV) times number of shares gives the net assets of the fund, not total proceeds. Total proceeds from selling shares depend on the offer price.
• Option c: Offer price is the price at which shares are sold. Multiplying offer price by the number of shares sold gives the total proceeds from selling those shares.
• Option d: Profit minus investment is not related to mutual fund proceeds calculation.

Answer:

c. offer price times number of shares