Question

6.a) Hafeeza invested

$2000 in a mutual fund
that increased in value
in its first year by 1.92%. If
there was a 2.5%
management fee,
determine the value of her
investment after one year.

Answer 1

To determine the value of Hafeeza's investment after one year with a management fee of 2.5%, we need to calculate the increase in value of her mutual fund after one year and then subtract the management fee from it. We can start by calculating the increase in value of her
mutual fund. Increase in value = $2000 x
1.92% = $38.40 Next, we can calculate the
management fee. Management fee = $2000
× 2.5% = $50 Now we can subtract the management fee from the increase in value to find the value of her investment after one
year. Value after one year = $2000 +
$38.40 - $50 = $1988.40 Therefore, the
value of Hafeeza's investment after one year with a management fee of 2.5% is $1988.40.