Question

Tiffany scott puts $22,000 into a load mutual fund. she knows that her up-front sales charge is 2.5%. how much of her money actually goes to buy shares in the mutual fund?

a. $22,000
b. $22,550
c. $5.50
d. $21,450
e. $550

Answer 1

The correct option is d. Tiffany Scott puts $22,000 into a load mutual fund with a 2.5% up-front sales charge. The amount of her money actually used to buy shares in the mutual fund is $21,450.

Step-by-step explanation:

In this question, Tiffany Scott puts $22,000 into a load mutual fund and has an up-front sales charge of 2.5%. The sales charge is deducted from the initial investment amount. To calculate how much of her money actually goes to buy shares in the mutual fund, we need to subtract the sales charge from the initial investment amount.

2.5% of $22,000 is (2.5/100) * $22,000 = $550. Therefore, the amount of her money actually used to buy shares in the mutual fund is $22,000 - $550 = $21,450.