kim226

Both open-end and closed-end funds typically charge:

A) an annual management fee.

B) a front-end load.

C) a premium to the underlying net asset value (NAV).

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Both types of managed funds, open-end and closed-end, typically charge an annual management fee. Open-end funds sometimes charge a front-end load or a redemption fee, but closed-end funds do not. Closed-end funds can sell at a premium (or discount) to underlying NAV, but this does not result in compensation to the fund.

kim226

For the equity shares of an open-end investment company, the share value:

A) is determined in the secondary market.

B) always equals NAV.

C) may or may not equal NAV.

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Shares of a closed-end investment company are determined in the secondary market and may or may not equal NAV. Share value of an open-end investment company always equals NAV because the investment company stands ready to redeem shares at their net asset value.