Mutual Funds
A mutual fund has total assets of $200 million, liabilities of $2 million, and 10 million shares outstanding. What is the NAV per share?
When calculating NAV, remember: Assets minus Liabilities, then divide by shares outstanding. The order matters - subtract first, then divide!
Complete Analysis & Legal Rationale
NAV = (Assets - Liabilities) / Shares Outstanding = ($200M - $2M) / 10M = $198M / 10M = $19.80 per share.
Distractor Autopsy (Why Other Options Are Traps)
FINRA exam writers design incorrect distractors using specific calculation mistakes and regulatory misconceptions. Review why each option succeeds or fails:
Matches the verified teaching point in the explanation.
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Does not match the governing securities rule described in the explanation.
Official Standard: Regulatory framework for investment companies including mutual funds (verify current text).
Official Standard: Outline-level citation: item maps to Series 7 topic coverage. Prefer a specific FINRA/SEC/MSRB rule citation in a later author pass.