Here’s an example of how breakpoint discounts on sales commissions for mutual fund investors work: Sales charge Less than $25,000, 5.25% $25,000 to $49,999, 5% $50,000 to 99,999, 4.25% $100,000 to $249,999, 3.25% Nancy Dolan is interested in the T Rowe Price Mid Cap Fund. Assume the NAV is 19.21. a. What minimum amount of shares must Nancy purchase to have a sales charge of 5%? (Round up to the nearest share even if it is less than 5.) Minimum Amount of Shares: b. What minimum amount of shares must Nancy purchase to have a sales charge of 4.25%? (Round up to the nearest share even if it is less than 5.) Minimum Amount of Shares: c. What minimum amount of shares must Nancy purchase to have a sales charge of 3.25%? (Round up to the nearest share even if it is less than 5.) Minimum Amount of Shares: d. What would be the total purchase price for (a), (b), or (c)? (Round your answers to the nearest cent.) Total Purchase Price: a) b) c)
Here’s an example of how breakpoint discounts on sales commissions for mutual fund investors work:
Sales charge
Less than $25,000, 5.25%
$25,000 to $49,999, 5%
$50,000 to 99,999, 4.25%
$100,000 to $249,999, 3.25%
Nancy Dolan is interested in the T Rowe Price Mid Cap Fund. Assume the NAV is 19.21.
a. What minimum amount of shares must Nancy purchase to have a sales charge of 5%? (Round up to the nearest share even if it is less than 5.)
b. What minimum amount of shares must Nancy purchase to have a sales charge of 4.25%? (Round up to the nearest share even if it is less than 5.)
c. What minimum amount of shares must Nancy purchase to have a sales charge of 3.25%? (Round up to the nearest share even if it is less than 5.)
Minimum Amount of Shares:
d. What would be the total purchase price for (a), (b), or (c)? (Round your answers to the nearest cent.)
Total Purchase Price:
a)
b)
c)
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