MAT 135 – Writing Assignment 4

A mutual fund that makes money in 2009!

Below is a fictional letter that has been written to you. You should develop, along with your
other group members, a response to the letter. Use of Microsoft Excel may be very helpful, and
it should probably be a large part of your attack of the problems posed to you.

I will not list all the items that I would like to see, nor do I want to tell you explicitly how you
should go about completing this project – it is this aspect (I think) that makes this writing
assignment worthwhile. But I will give a few friendly comments:

1. Your written response should be respectful. Steven, the character from the letter below,
has taken the time to write a letter asking for your assistance. You should put some
thought into the manner of your response. Be creative in your final product.
2. Make sure any of the data you give him is easy to understand. If you use graphs, make
sure they are well-organized and easy to understand. It would be best if the graphs are
large, centered, and easy-to-read with axes labels and titles.
3. Do your best. If you think that there is a question you cannot fairly or honestly answer –
and it may very well be that, in your opinion, you cannot answer some of his questions –
say so. Defend what you say.
4. The mathematics of this assignment is not difficult, but modeling the situation may be
non-trivial. Make sure you completely understand the various aspect of the problem. It
might help to define where you want to go before you dive in to the data.

There is one other item you should turn in other than your response. Each group member
should type a short statement, of length no longer than one page, describing what each
group member (including oneself) contributed to the project. It will be worth 10 points,
and will be graded as follows:

1. You should explain what you did on the assignment. This should be its own
paragraph. (3 points)
2. You should explain what each other group member did on the assignment. This
should be its own paragraph. (3 points)
3. You should explain how the group worked with one another (the group dynamic).
Any problems should be specifically addressed in enough detail that I can
understand what the problems were. This should take AT LEAST one paragraph.
(4 points)
4. I will subtract one point for each grammatical error (up to 10 points).

November 22, 2009

Calculus Students
c/o Professor Justin M. Gash
Mathematics Department
Franklin College
101 Branigin Blvd.
Franklin, IN 46131

Dear Calculus Class:

I hope this letter finds you well. My name is Steven Yusef, and I am an investment banker from
Indianapolis. I am in need of assistance in my work. My company, IndyBank, has recently
started a community outreach initiative so that we are more involved with the everyday lives of
our constituency. I thought (being that we have many people from Franklin and the surrounding
area that use IndyBank) that I would get involved with the education of our local college
students. Thus I have sent this problem to several different colleges in the area.

I have a mutual fund that has been doing well over the past few years, and I have several clients
who have taken my advice and purchased the mutual fund. I have all types of data in regards to
its performance – and I will provide that below – but I do not have all the information I could
have. This became apparent last month when one of my clients asked the question: How much
money (revenue) has this stock generated for me since I bought it?

When I stopped to think about it, this was an interesting question. Though I could address his
portfolio as a whole, I did not have the data that answered the question.

You might be thinking: Isn’t that easy? Why not simply find out how much the fund was worth
when he bought it, find out how much it is worth now, and subtract. Normally you would be
correct. But we utilize this fund in an unusual way. Let me explain.

My client purchased the fund for $10000 on January 1, 2009. It is now worth $13000 (as of
November 22), meaning that most people would say that he has made $3000 on his mutual fund.
However, once the fund went above $12000, the mutual fund automatically transfers the amount
over $12000 into a different, high-risk fund. The company actually gives him a 1% additional
return on this money.

In short, if my client’s fund was at $14000, he had $2000 was invested behind-the-scenes in an
account that would make him a 1% return. That means that he made .01*$2000=$20 that day.
That means that each day the fund is worth more than $12000, he is making a 1% return
(interest) on the overage that day.

Thus, while it is true that he has made $3000 ($13000-$10000) since January 1, he has also made
some extra cash on days where the fund was higher than $12000 in value.

Here’s the data you want.

Day Value of Fund (in $)

January 1, 2009 10000
 February 1, 2009 11300
March 1, 2009 12000
April 1, 2009 12400
May 1, 2009 12900
June 1, 2009 13000
July 1, 2009 12300
August 1, 2009 11900
September 1, 2009 11800
October 1, 2009 12400
November 22, 2009 13000

I would think you could chart this fairly easily using Microsoft Excel, though I would imagine
you might want to break it down by days (where January 1, 2009 is day 1, February 1, 2009 is
day 32, etc.).

I would appreciate you letting me know how much money my client has made this year… or, at
least how much he made by November 22. Hopefully I will have the time to bring the students
from the class with the best response for a tour and lunch in our Indy offices. Good luck, and
thanks for your help! (And thanks to Dr. Gash for offering me this opportunity to write to you.)

Sincerely,
Steven Yusef,
IndyBank Investments Division

This work is licensed under the Creative Commons Attribution-Noncommercial-Share Alike 3.0
United States License. To view a copy of this license, visit
http://creativecommons.org/licenses/by-nc-sa/3.0/us/ or send a letter to Creative Commons, 171
Second Street, Suite 300, San Francisco, California, 94105, USA.