If an investment company issued 1 million shares for $20, and its portfolio of investments is now worth $38 million, what is its net asset value (NAV)?
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A. B. C. D. E.Explanation
An investment company sells shares in itself, and uses the proceeds to invest in a portfolio of individual investments such as stocks and bonds. The NAV is equal to the net value of the investment company's assets divided by the number of its shares outstanding. In this question the NAV is equal to $38 million / 1 million =
$38.