Patricia cancels a RAC during the cooling-off period when the fund price had fallen by 10% since issue. What is the MAXIMUM refund she is legally entitled to?

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Multiple Choice

Patricia cancels a RAC during the cooling-off period when the fund price had fallen by 10% since issue. What is the MAXIMUM refund she is legally entitled to?

Explanation:
During the cooling-off period, you can cancel and receive back the value of the RAC at the cancellation date. It’s not a refund of the original amount if the fund’s value has fallen; you get the current market value of the investment. If the RAC was issued at €50,000 and the fund price has fallen 10%, the current value is 50,000 × 0.90 = €45,000. Therefore, the maximum refund she is entitled to is €45,000 (assuming no additional surrender charges apply).

During the cooling-off period, you can cancel and receive back the value of the RAC at the cancellation date. It’s not a refund of the original amount if the fund’s value has fallen; you get the current market value of the investment.

If the RAC was issued at €50,000 and the fund price has fallen 10%, the current value is 50,000 × 0.90 = €45,000. Therefore, the maximum refund she is entitled to is €45,000 (assuming no additional surrender charges apply).

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