The net realisable value of a mutual fund unit is known as ___________.(1.0 Marks)Assets Under ManagementAEntry LoadBNet Asset ValueCExit Load

Break Down the Problem

1. Identify the terms related to mutual funds.
2. Determine which term correctly describes the net realizable value of a mutual fund unit.

Relevant Concepts

• Assets Under Management (AUM): Total market value of the assets a mutual fund manages.
• Entry Load: A fee charged when an investor buys into a mutual fund.
• Net Asset Value (NAV): The price per share or unit of a mutual fund, calculated by dividing the total net assets by the number of outstanding units.
• Exit Load: A fee charged when an investor sells their mutual fund shares.

Analysis and Detail

The net realizable value of a mutual fund unit is essentially how much it is worth at a given time, which is primarily represented by its Net Asset Value (NAV). The NAV reflects the total value of the fund's assets minus liabilities, divided by the number of units outstanding.

Verify and Summarize

After analyzing the definitions:

• Assets Under Management refers to the total assets managed, not the value per unit.
• Entry Load and Exit Load are fees and do not reflect the net realizable value.
• Net Asset Value (NAV) directly relates to the net realizable value of a mutual fund unit.

Final Answer

B. Net Asset Value