Question

Satish invested 1,50,000 in a mutual fund scheme with no entry load and exit load of 3% upto 3 years. He receives dividend at 5% per year for 7 years. At the end of 7 years, NAV is 180000. What is the rate of return

Answer 1

Answer:

the answer is of the Question is 210000000

Answer 2

Given:

Initial investment - 1,50,000

Exit load - 3% for 3 years.

Dividend - 5%

Time - 7 years

NAV - 180,000

To find:

Rate of return.

Solution:

Initial investment - 1,50,000

Exit load - 3% for 3 years.

Dividend - 5%

Time - 7 years

NAV - 180,000

The formula for Rate of return is

$r = \frac{vf - vi}{vi}$

in the formula:

r - the rate of return

vf - final value including divided (NAV)

vi- the initial value.

adding that values in the formula for rate of return.

$r = \frac{180000 - 150000}{180000}$

$r = \frac{30000}{180000}$

$r = 0.2$

multiplying by 100 to turn into a percentage.

$r = 0.2 \times 100$

$r = 20\%$

Therefore, the rate of return is 20% for the above investment.