calculating price of fund

I have calculated following using $34.5 (1+0.052). How come the value is obtained by dividing with (1-0.052)? ---------------------------- An investor is contemplating buying a load fund versus a no load mutual fund. She is trying to figure out the actual amount she will have to spend on the load fund. The shares have a net asset value (NAV) of $34.50 and a load of 5.2 percent. Determine which type of fund will always have a share price equal to the NAV and the price she will pay for the load fund. Fund Offering Price A) closed-end $34.50 B) closed-end $36.39 C) open-end $36.39 D) open-end $34.50 Your answer: D was incorrect. The correct answer was C) open-end $36.39 The share price of an open-end fund will always equal the NAV, since the investment company is obligated to redeem shares at any time at current market value. Offering price = $34.50 / (1 – 0.052) = $36.39.

suppose you paid x(which is what we need to calculate) NAV = 94.8 % of X (because 5.2% was deducted as load) i.e. 34.5 = .948 X X= 34.5/.948

Reema, I understood now. Thanks a lot for the reply.