Question

How is the yearly return on a mutual fund calculated?

a.

Return percentage = (C + D) / (NAV₁ - NAV₀)

b.

Return percentage = (C - D) / (NAV₁ + NAV₀)

c.

Return percentage = (D + C + (NAV₁ - NAV₀)) / NAV₀

d.

Return percentage = (D - C - (NAV₁ - NAV₀)) / NAV₀

Answer: (c).Return percentage = (D + C + (NAV₁ - NAV₀)) / NAV₀ Explanation:The formula for calculating the yearly return on a mutual fund is given by (D + C + (NAV₁ - NAV₀)) / NAV₀ , where D represents Dividend Received, C represents Capital Realized, NAV₁ is the Net Asset Value at the end of the year, and NAV₀ is the Net Asset Value at the beginning of the year.

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Q. How is the yearly return on a mutual fund calculated?

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