UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM N-CSR

CERTIFIED SHAREHOLDER REPORT OF REGISTERED

MANAGEMENT INVESTMENT COMPANIES

Investment Company Act file number 811-06111

The Mexico Equity and Income Fund, Inc.
(Exact name of registrant as specified in charter)

615 E. Michigan Street

Milwaukee, Wisconsin 53202
(Address of principal executive offices) (Zip code)

Ms. Elisa Estevez

c/o U.S. Bancorp Fund Services, LLC

615 E. Michigan Street

Milwaukee, Wisconsin 53202
(Name and address of agent for service)

(800) 937-5449

Registrant's telephone number, including area code

Date of fiscal year end: July 31

Date of reporting period: July 31, 2024

Item 1. Reports to Stockholders.

(a)

THE MEXICO EQUITY AND INCOME FUND, INC.

Annual Report

July 31, 2024

El Palacio de Bellas Artes Mexico City, Mexico. CANVA. 2021

THE MEXICO EQUITY AND INCOME FUND, INC.

Annual Report

Table of Contents

1		Letter to Stakeholders
11		Relevant Economic Information
13		Allocation of Portfolio Assets
14		Schedule of Investments
17		Statement of Assets & Liabilities
18		Statement of Operations
19		Statements of Changes in Net Assets
20		Financial Highlights
21		Notes to Financial Statements
45		Report of Independent Registered Public Accounting Firm
46		Additional Information
51		Dividends and Distributions
53		Results of Annual Stockholders Meeting
54		Privacy Policy
56		Management of the Fund

The Mexico Equity and Income Fund, Inc.

Report of Pichardo Asset Management (“PAM”),

the Investment Adviser (Unaudited)

Dear Fund Stockholders,

We are pleased to present the Fund’s Portfolio Management Report for the year ending July 31, 2024. This report provides an overview of the global economic forecast, Mexico’s economic activity, and financial markets. We also include a review of the Fund’s Return Attribution Analysis for the fiscal year ended July 31, 2024, and its long-term performance, as well as the Mexican stock exchange behavior.

Introduction

The global economic growth forecast for 2024 is expected to be lower than that of 2023, with economic activity showing varying levels of dynamism across different countries. Prospects point to higher growth in advanced economies and lower growth in emerging economies, according to Banco de México, Central Bank (“BANXICO”). The United States registered higher-than-anticipated growth in the second quarter of 2024, while China exhibited a low economic dynamism. Japan’s economic activity is expected to recover, following the sharp contraction observed in the previous quarter. The downside risks to the world economic growth prospects likely refer to the following:

	1.	Lagged effects of interest rates remain high for more extended than expected.
	2.	The potential escalation of conflicts in the Middle East.
	3.	Increased trade tensions.

México’s Gross Domestic Product (“GDP”) registered an annual growth of 1.0% in the second quarter of 2024, with productivity activity registering low growth (0.2% at a seasonally adjusted quarterly rate) showing more significant weakness than anticipated for three consecutive quarters (1Q’24 with 0.1% and 4Q’23 with -0.1%) since December 2023, decoupling from US economic activity. Source: INEGI.

Consumption maintains its dynamism, growing at an annual rate of 2.8% and remaining at high levels. In comparison, aggregate demand grew at an annualized quarterly rate of close to 6% in the first quarter of 2024, mainly driven by household consumption. However, it is showing signs of moderation that we are closely monitoring. In the external sector, manufacturing exports showed some sluggishness and a lateral trend. Source: INEGI.

Please see the July Economic Report at the Fund’s webpage: mxefund.com

In most advanced economies, the disinflation process continues showing heterogeneity, but short - and long-term inflation expectations remained above the inflation targets in most advanced economies. Thus, the central banks of the advanced and emerging economies adjusted their reference rates heterogeneously. Notably, the Bank of Japan raised its interest rate. Mexico Central Bank’s (“BANXICO”) Board decided by

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

majority to lower its reference rate target for the overnight interbank rate by 25 basis points to 10.75%, a spread differential of 525 basis points to that of the U.S. The US Federal Reserve left the target range for the federal funds rate unchanged for the eighth consecutive decision. Source: Banxico.

International financial markets increased their risk-aversion, causing higher volatility by mid-July by some US employment data, suggesting a lower dynamism of the labor market in the United States; and unexpected Japan’s second increase in its reference rate this year, since 2008, led to a significant appreciation of the yen and notorious depreciation of currencies.

The MXN Peso, with a profound market typically used for unwinding carry trade positions against the yen, depreciated approximately -8.6% from May 31, 2024, to July 31, 2024. Source: Bloomberg.

Following the above-mentioned higher risk aversion momentum, the main stock markets, particularly the technology sector, contracted. The (“IPyC”) Mexican stock market index lowered -11.03% in US Dollars from May 31 to July 31, 2024, the end of the Fund’s fiscal year. The depreciation of the MXN peso contributed -8.6%, and equities -2.43%. Source Bloomberg.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

MXE Short- & Long-Term Performance

Source: Bloomberg.

(1)	The returns shown are based on net asset value calculated for shareholder transactions, which do not reflect adjustments made to the net asset value for financial reporting purposes per accounting principles generally accepted in the United States of America.

Source: U.S. Bancorp Fund Services, LLC.

*		On October 12, 2021, the fund announced the results of its Opportunistic Rights Offering for 146% of outstanding shares at a subscription price of US $8.90 per common stock.
**		On January 31, 2020, the Fund successfully completed the Tender Offer to purchase up to 67% of outstanding shares at 98% of the net asset value (“NAV”).

Performance data represents past performance; past performance does not guarantee future results.

The investment return and principal value of an investment will fluctuate so that the investor’s shares, when sold, may be worth more or less than their original cost. Performance data to the most recent month end may be obtained by calling U.S. Bancorp Fund Services, LLC, (414)765-4255, or by consulting the Fund’s web page: www.mxefund.com.

The Fund’s shares have traded in the market above (at a premium), at, and below (at a discount) the net asset value per share (NAV) since the commencement of the Fund’s operations. Generally, shares of closed-end investment companies, including those of the Fund, trade at a discount from NAV.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

The net per share asset value (“NAV”) registered a return in Mexican Pesos of minus 0.73% and a return of -10.43% in U.S. dollars (calculated based on net asset value calculated for shareholder transactions, which does not reflect adjustments made to the net asset value for financial reporting purposes per accounting principles generally accepted in the United States of America), including a 1.91% ratio of expenses to an average net asset, for the one year, ending July 31, 2024 — Source: U.S. Bancorp; Bloomberg. The MXN peso has traded in the range of 17.52 to 19.84 pesos per U.S. dollar since Mexico’s General Election outcome on June 2, 2024, with depreciation of -8.6% from May 31 to July 31, 2024. Source: Bloomberg.

Long-Term Performance

Please refer to the Fund’s Opportunistic Non-Transferable Rights Offering for 146% of outstanding shares at a subscription price of U.S. $8.90 per common stock on October 12, 2021, proposed by the BOD to the Fund’s Stakeholders to subscribe with a high discount to market price to better assess PAM’s quality portfolio management.

Return Attribution Analysis

The return attribution analysis presents the two largest stock detractors related to the Consumer Discretionary, automotive parts industry, and the other to the Real Estate Services, industrial parks built to suit industry. Both Companies’ management continues to fully engage with frustrated financial quarters but good forward financial prospects. Challenges to those industries refer to the COVID-19 pandemic after the supply shocks (automotive parts production) and higher-than-expected interest rates in the industrial parks, which are the main conceptual elements affecting these sectors. The second lagger sector was the Materials sector, which refers to one beta stock. Despite the challenges, the Materials sector’s forward fundamentals remain solid, forecasting lower interest rates in Mexico.

We are optimistic about the potential of the cheap-value Fund construction portfolio and companies in a higher economic scenario. This optimism is based on the promising demographics and nearshoring prospects, which indicate a bright future for these entities.

Schedule of Investments

Source: PAM; Bloomberg.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

Closing Remarks

The economic activity forecast suggests a modest expansion for the full year 2024. According to BANXICO, the stable U.S. economic growth prospect is the primary factor influencing better economic activity prospects in Mexico. Our confidence in public government finances remains unwavering for its health and stability. Please see Exhibits 1 and 2.

Compared to its history and forward earnings yield, the MEXBOL Index is attractive. This attractiveness is significant as it indicates a favorable relationship between valuation and forward earnings growth. The forward-looking data shows a double-digit discount to the 5- and 15-year average, which is a promising sign for potential investors. Please see Exhibits 3 and 4.

The Fund’s investment strategy and Portfolio construction remain highly diversified, providing a secure foundation encompassing companies with local and international sales and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) exposure. PAM continues to align the Fund to its Investment Objectives and Restrictions. Our strategy is to identify companies with strong long-term fundamentals, avoiding the market’s short-term volatility. We have a strong preference for experienced company management, particularly those with the ability to operate in stressful financial conditions and those with decades of international experience, primarily within the northern American region, EU, and South America.

Ms. Claudia Sheinbaum, President elected, will take office on October 1, 2024. For the first time, Mexico will have a President with an absolute majority in Congress and a highly scientific and experienced cabinet. The market has good prospects for a president capable of having good relationships with entrepreneurs and the press. In a recorded message, Marcelo Ebrard, future Secretary of Economy, stated that the Mexican government would facilitate foreign investments and said, ‘We are a friendly country for investments coming from the United States.’ — Source: El Financiero.

Sincerely,

Eugenia Pichardo, Senior Portfolio Manager

David Estevez Analyst and Portfolio Manager

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

Exhibit 1.

United States of America International Trade.

Source: U.S. Census Bureau. Amounts in millions of US dollars.

Exhibit 2.

Historical Net Debt as % of GDP

As of 1H24.

Source: Ministry of Finance and Public Credit

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

Exhibit 3.

MEXBOL Index Forward 12-Mos Price to Earnings (P/E) Multiple

Long term, as of July 31, 2024.

Source: PAM; Bloomberg.

Exhibit 4.

MEXBOL INDEX, 12-month forward EV/EBITDA Multiple

Long term, as of July 31, 2024.

Source: PAM; Bloomberg.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

DISCLAIMER

The Mexico Equity and Income Fund, Inc. (“the Fund”) maintains a long-term capital appreciation investment objective through investments in securities, primarily equity, listed on the Mexican Stock Exchange. The Fund provides a vehicle to investors who wish to invest in Mexican companies through a managed non-diversified portfolio as part of their overall investment program.

Fund holdings and sector allocations are subject to change at any time and should not be considered a recommendation to buy or sell any security. Please see the Schedule of Investments in this report for a complete list of fund holdings. The information and views provided herein represent the opinion of Pichardo Asset Management, not the Fund’s Board of Directors, and it does not intend to be a forecast of future events, a guarantee of future results, or investment advice. This report contains certain forward-looking statements about factors that may affect the performance of the Fund in the future.

Management believes these forward-looking statements to be reasonable, although they are inherently uncertain and difficult to predict.

Investors must carefully consider the Fund’s investment objectives, risks, charges, expenses and restrictions. The prospectus contains this and other important information about the investment company, which may be obtained by calling U.S. Bancorp Fund Services, LLC, (414) 765-4255. Read it carefully before investing.

All investments involve risk. Principal loss is possible.

Definitions

	•	The stock’s net asset value (NAV) is the value of a fund’s assets minus its liabilities. The term “net asset value” is commonly used concerning closed-end funds and is used to determine the value of the assets held.

	•	The market price of the ordinary share of a closed-end fund is determined in the open market by buyers and sellers and is the price at which investors may purchase or sell the common shares of a closed-end fund, which fluctuates throughout the day. The common share market price may differ from the Fund’s Net Asset Value; shares of a closed-end fund may trade at a premium to (higher than) or a discount to (lower than) NAV. The difference between the market price and NAV is a discount.

	•	A basis point (bps) is one-hundredth of a percentage point (0.01%).

	•	Premium/Discount: The share price of an investment trust can differ from the net asset value (NAV). If the current share price is above the NAV, the investment trust is said to be trading at a premium, i.e. it costs more to buy the shares than the underlying investments are worth. When the share price is below the NAV, this is known as trading at a discount.

	•	MEXBOL, or the IPC (Indice de Precios y Cotizaciones), is a capitalization-weighted index of the Mexican stock exchange’s leading stocks.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

	•	MSCI-Mexico Net Total Return Index: The Morgan Stanley Capital International Index Mexico is a free float capitalization-weighted index that tracks the Mexican Stock Market. One cannot invest directly in an index.

	•	BANXICO: Banco de Mexico is the Central Bank of Mexico. By constitutional mandate, it is autonomous in both its operations and management. Its primary function is to provide domestic currency to the Mexican economy, and its main priority is to ensure the stability of the domestic currency’s purchasing power.

	•	Reference Rate: is an interest rate benchmark used to set other interest rates. Various types of transactions use different reference rate benchmarks, but the most common include the Fed Funds Rate, LIBOR, the prime rate, and the rate on benchmark U.S., among others.

	•	INEGI: The National Institute of Statistics and Geography.

	•	OECD: Organization for Economic Co-operation and Development.

	•	Gross Domestic Product (GDP): is the standard measure of the value added created through the production of goods and services in a country during a certain period. As such, it also measures the income earned from that production, or the total amount spent on final goods and services (less imports).

	•	Nearshoring: is a strategy in which a company moves all or part of its production closer to the final consumer, reducing costs and avoiding logistical setbacks. In the last couple of years, many businesses around the world have started to look at this as an alternative, primarily to avoid supply chain issues.

	•	Foreign Direct Investment: is an ownership stake in a foreign company or project made by an investor, company, or government from another country.

	•	Gross Fixed Investment: measures the total value of all acquisitions of fixed assets, both tangible and intangible, obtained as a result of a production process. The value represents a year-over-year change in the gross fixed investment, obtained by aggregating the constant values of machinery and equipment of both national and foreign origin and of construction.

	•	Forward PE Ratio: The regular P/E ratio is a current stock price over its earnings per share. The forward P/E ratio is a current stock’s price over its “predicted” earnings per share. If the forward P/E ratio is higher than the current P/E ratio, it indicates decreased expected earnings.

	•	EV/EBITDA: Is a popular valuation multiple used in the finance industry to measure the value of a company. It is the most widely used valuation multiple based on enterprise value.

	•	Attribution analysis: is a sophisticated method for evaluating the performance of a portfolio or fund manager. The method focuses on three factors: the manager’s investment style, their specific stock picks and the market timing of those decisions. It attempts to provide a quantitative analysis of the aspects of a fund manager’s investment selections and philosophy that lead to that fund’s performance.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

	•	Treasury Bond (T-Bond): Is a marketable, fixed-interest U.S. government debt securities with a maturity of more than 10 years. Treasury bonds make interest payments semiannually, and the income received is only taxed at the federal level.

	•	M-Bond: Mexico Federal Government fixed-rate development bonds that are issued and placed at terms of over one year, pay interest every six months and their interest rate is determined at issue date and remains fixed all along the life of the bond.

	•	Consumer Price Index (INPC): Is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care. It is calculated by taking price changes for each item in the predetermined basket of goods and averaging them.

THE MEXICO EQUITY AND INCOME FUND, INC. (Unaudited)

RELEVANT ECONOMIC INFORMATION for the years ended December 31

Real Activity (billion US$)	2023		2022		2021		2020		2019
Real GDP Growth (y-o-y)	3.20	%	3.68	%	6.27	%	-8.55	%	-0.39	%
Industrial Production (y-o-y)	-1.90	%	-8.97	%	6.49	%	4.70	%	3.54	%
Trade Balance (US billions)	$39.54		$-26.92		$-10.75		$34.18		$5.36
Exports (US billions)	$593.01		$577.70		$494.95		$417.17		$460.60
Export growth (y-o-y)	2.65	%	16.72	%	18.64	%	-9.43	%	2.22	%
Imports (US billions)	$553.47		$604.61		$505.70		$382.99		$455.24
Import growth (y-o-y)	-8.46	%	19.56	%	32.04	%	-15.87	%	-1.95	%

Financial Variables and Prices
28-Day CETES (T-bills)/Average	11.10	%	7.66	%	4.45	%	5.30	%	7.85	%
Exchange rate (Pesos/US$)Average	17.74		20.11		20.29		21.47		19.25
Inflation IPC, 12 month trailing	5.55	%	7.89	%	5.68	%	3.40	%	3.64	%

Mexbol Index
USD Return	40.87	%	-1.09	%	20.94	%	-2.35	%	12.05	%
Market Cap- (US billions)	$438.75		$312.32		$326.47		$281.62		$285.98
EV/EBITDA	5.34	x	5.67	x	7.29	x	8.42	x	7.37	x

Fund’s NAV & Common Share
Market Price Performance
NAV per share	32.95	%	4.85	%	-4.05	%	-3.25	%	8.48	%
Share Price	30.97	%	-1.57	%	-8.42	%	-16.03	%	16.37	%
MSCI Mexico Index	40.92	%	-2.02	%	22.53	%	-1.85	%	11.37	%
iShares MSCI Mexico	40.36	%	1.26	%	20.30	%	-3.05	%	12.64	%

Sources: Banamex, Banco de Mexico, Bloomberg, MSCI.

THE MEXICO EQUITY AND INCOME FUND, INC.

Performance at a glance (unaudited)

Average annual total returns for common stock for the periods ended 7/31/2024

Net asset value returns⁽¹⁾	1 year	5 years	10 years
The Mexico Equity and Income Fund, Inc.	-10.43%	4.09%	-1.09%

Market price returns
The Mexico Equity and Income Fund, Inc.	-7.98%	-0.75%	-3.01%

Index returns
MSCI Mexico Index	-9.91%	8.90%	0.56%

Share price as of 7/31/2024
Net asset value			$13.08
Market price			$ 9.59

⁽¹⁾	The returns shown are based on net asset value calculated for shareholder transactions, which do not reflect adjustments made to the net asset value for financial reporting purposes in accordance with accounting principles generally accepted in the United States of America.

Past performance does not predict future performance. The return and value of an investment will fluctuate so that an investor’s share, when sold, may be worth more or less than their original cost. The Fund’s common stock net asset value (“NAV”) return assumes, for illustration only, that dividends and other distributions, if any, were reinvested at the NAV on the ex-dividend date. The Fund’s common stock market price returns assume that all dividends and other distributions, if any, were reinvested at the lower of the NAV or the closing market price on the ex-dividend date. NAV and market price returns for the period of less than one year have not been annualized. Returns do not reflect the deduction of taxes that a shareholder could pay on Fund dividends and other distributions, if any, or the sale of Fund shares.

The MSCI Mexico Index is designed to measure the performance of the large and mid cap segments of the Mexican market. With 24 constituents, the MSCI Mexico Index covers approximately 85% of the free float-adjusted market capitalization in Mexico.

THE MEXICO EQUITY AND INCOME FUND, INC.

Allocation of Portfolio Assets	July 31, 2024 (Unaudited)
(Calculated as a percentage of Total Investments)

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Schedule of Investments

MEXICO – 99.2%	Shares		Value

COMMON STOCKS – 85.9%

Airlines – 1.0%
Controladora Vuela Compania de Aviacion, S.A.B. de C.V. – Series A (a)		948,211	$	583,757

Airports – 4.5%
Grupo Aeroportuario del Sureste, S.A.B. de C.V. – Series B		85,568		2,580,221

Auto Parts & Equipment – 2.9%
Nemak, S.A.B. de C.V. (a)		12,180,790		1,660,631

Beverages – 11.5%
Arca Continental, S.A.B. de C.V.		290,620		2,859,872
Coca-Cola FEMSA, S.A.B. de C.V.		156,700		1,421,915
Fomento Economico Mexicano, S.A.B. de C.V. – Series UBD		212,622		2,347,961
				6,629,748
Building Materials – 12.1%
Cemex, S.A.B. de C.V. – Series CPO		7,426,815		4,799,466
Grupo Cementos de Chihuahua, S.A.B. de C.V.		252,596		2,144,714
				6,944,180
Communication Services – 6.8%
America Movil, S.A.B. de C.V. (a)		4,699,563		3,924,921

Consumer Finance – 2.8%
Gentera, S.A.B. de C.V.		1,363,000		1,616,052

Consumer Products – 0.8%
Kimberly-Clark de Mexico, S.A.B. de C.V. – Series A		275,600		490,225

Financial Groups – 4.0%
Grupo Financiero Banorte, S.A.B. de C.V. – Series O		308,163		2,309,196

Food – 5.1%
Grupo Bimbo, S.A.B. de C.V. – Series A		833,186		2,914,429

Hotels, Restaurants, and Recreation – 5.6%
Alsea, S.A.B. de C.V.		945,564		2,854,811
Grupe, S.A.B. de C.V. (a)(b)		200,591		372,521
				3,227,332

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Schedule of Investments (continued)

COMMON STOCKS (continued)	Shares		Value

Mining – 5.1%
Grupo Mexico, S.A.B. de C.V. – Series B		519,337	$	2,926,863

Real Estate Services – 7.2%
Corporacion Inmobiliaria Vesta, S.A.B. de C.V.		1,417,871		4,152,168

Retail – 16.5%
El Puerto de Liverpool, S.A.B. de C.V. – Series C1		248,024		1,740,868
Grupo Comercial Chedraui, S.A. de C.V.		343,787		2,562,118
Wal-Mart de Mexico, S.A.B. de C.V.		1,564,562		5,203,170
				9,506,156
TOTAL COMMON STOCKS (Cost $46,894,413)				49,465,879

CAPITAL DEVELOPMENT CERTIFICATES – 1.2%

Atlas Discovery Trust II (a)(b)		300,000		709,036
TOTAL CAPITAL DEVELOPMENT CERTIFICATES (Cost $2,147)				709,036

MEXICAN MUTUAL FUNDS – 0.9%

Scotiabankinverlat – Scotia Gubernamental, S.A. de C.V. S.I.I.D. (a)		1,891,469		519,550
TOTAL MEXICAN MUTUAL FUNDS (Cost $527,509)				519,550

REAL ESTATE INVESTMENT TRUSTS – 9.0%

Macquarie Mexico Real Estate Management, S.A. de C.V.		1,546,371		2,582,127
Prologis Property Mexico, S.A. de C.V.		775,334		2,588,469
TOTAL REAL ESTATE INVESTMENT TRUSTS (Cost $5,706,708)				5,170,596

MEXICAN FEDERAL CETES (C) – 2.2%	Par

11.32%, 04/30/2025 (d)		1,338,425		1,234,815
TOTAL MEXICAN FEDERAL CETES
(Cost $1,244,277)				1,234,815
TOTAL MEXICO (Cost $54,375,054)				57,099,876

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Schedule of Investments (concluded)

UNITED STATES – 1.2%	Shares		Value

MONEY MARKET FUNDS – 1.2%

Morgan Stanley Institutional Liquidity Funds –
Government Portfolio – Institutional Class, 5.21% (e)		673,598	$	673,598
TOTAL INVESTMENT COMPANIES (Cost $673,598)				673,598
TOTAL UNITED STATES (Cost $673,598)				673,598
TOTAL INVESTMENTS – 100.4% (Cost $55,048,652)				57,773,474
Liabilities in Excess of Other Assets – (0.4)%				(210,585	)
TOTAL NET ASSETS – 100.0%			$	57,562,889

Percentages are stated as a percent of net assets.

^(a)	Non-income producing security.
^(b)	Level 3 illiquid securities. Fair value determined using significant unobservable inputs in accordance with procedures established by and under the supervision of the Adviser, acting as Valuation Designee. These securities represented $1,081,557 or 1.9% of net assets as of July 31, 2024.
^(c)	Mexican Federal Treasury Certificates.
^(d)	The rate shown is the effective yield as of July 31, 2024.
^(e)	The rate shown represents the 7-day effective yield as of July 31, 2024.

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Statement of Assets & Liabilities

ASSETS:
Investments, at value (cost $55,048,652)	$	57,773,474
Receivable for investments sold		691
Interest receivable		2,999
Other Assets		22,112
Total Assets		57,799,276
LIABILITIES:
Payables:
Payable to the custodian		51,512
Advisory		48,971
Directors		39,982
Audit		34,295
Administration		16,134
Legal		12,276
Printing and mailing		10,333
Custody		8,209
Fund accounting		7,213
CCO		5,866
Transfer Agent		1,596
Total Liabilities		236,387
Net Assets		57,562,889
Net Asset Value Per Common Share ($57,562,889 / 4,400,209)	$	13.08
NET ASSETS CONSIST OF:
Common stock, $0.001 par value; 4,400,209 shares outstanding (98,144,872 shares authorized)		4,400
Paid-in capital		53,757,904
Total distributable earnings		3,800,585
Net Assets	$	57,562,889

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

Statement of Operations

For the Year Ended

July 31, 2024

INVESTMENT INCOME
Dividends⁽¹⁾	$	3,167,027
Interest		131,470
Total Investment Income		3,298,497
EXPENSES AND FEES
Advisory (Note B)		587,454
Directors (Note B)		196,878
Administration (Note B)		94,076
CCO (Note B)		66,900
Fund accounting (Note B)		43,597
Custodian (Note B)		42,375
Audit		34,277
Legal		33,144
Transfer Agent (Note B)		32,446
Printing and mailing		31,666
Insurance		25,080
NYSE		14,107
Total Expenses		1,202,000
NET INVESTMENT INCOME		2,096,497
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain from investments and foreign currency transactions		5,642,653
Net change in unrealized appreciation (depreciation) on investments and foreign currency transactions		(14,406,705	)
Net loss from investments and foreign currency transactions		(8,764,052	)
Net decrease in net assets resulting from operations	$	(6,667,555	)

⁽¹⁾	Net of $303,942 in dividend withholding tax.

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

Statements of Changes in Net Assets

	For the			For the
	Year Ended			Year Ended
	July 31, 2024			July 31, 2023
INCREASE (DECREASE) IN NET ASSETS
Operations:
Net investment income	$	2,096,497		$	1,899,641
Net realized gain on investments and foreign currency transactions		5,642,653			2,460,197
Net change in unrealized appreciation (depreciation) in value
of investments and foreign currency transactions		(14,406,705	)		15,326,147
Net increase (decrease) in net assets resulting from operations		(6,667,555	)		19,685,985

Distributions to Common Shareholders from:
Net dividends and distributions		(1,325,465	)		—
Decrease in net assets resulting from distributions		(1,325,465	)		—

Capital Share Transactions:
Proceeds from common stock sold through rights offering		—			—
Increase in net assets from capital share transactions		—			—

Total increase (decrease) in net assets		(7,993,020	)		19,685,985

Net Assets:
Beginning of year		65,555,909			45,869,924
End of year	$	57,562,889		$	65,555,909

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

Financial Highlights

For a Common Share Outstanding Throughout Each Year

	For the Year Ended July 31,
	2024			2023			2022			2021			2020
Per Share Operating Performance
Net asset value, beginning of year	$	14.90		$	10.42		$	14.43		$	9.04		$	11.03
Net investment income (loss)		0.48			0.43			0.43			(0.18	)		(0.08	)
Net realized and unrealized gains (losses) on
investments and foreign currency transactions		(2.00	)		4.05			(1.50	)		5.57			(2.27	)
Net increase (decrease) from investment operations		(1.52	)		4.48			(1.07	)		5.39			(2.35	)

Less: Distributions
Dividends from net investment income		(0.30	)		—			—			—			(0.12	)
Distributions from net realized gains		—			—			—			—			—
Total dividends and distributions		(0.30	)		—			—			—			(0.12	)

Capital Share Transactions
Anti-dilutive effect of Common
Share Repurchase Program		—			—			—			—			—
Anti-dilutive effect of Tender Offer		—			—			—			—			0.48
Dilutive effect of Common Share Rights Offering		—			—			(2.94	)		—			—
Total capital share transactions		—			—			(2.94	)		—			0.48
Net Asset Value, end of year	$	13.08		$	14.90		$	10.42		$	14.43		$	9.04

Per share market value, end of year	$	9.59		$	10.70		$	7.88		$	12.37		$	7.72
Total Investment Return Based on
Market Value, end of year⁽¹⁾		(7.98	)%		35.79	%		(36.30	)%		60.23	%		(24.50	)%

Ratios/Supplemental Data
Net assets, end of year (000’s)	$	57,563		$	65,556		$	45,870		$	25,770		$	16,158
Ratios of expenses to average net assets:		1.91	%		2.13	%		2.32	%		3.89	%		2.61	%
Ratios of net investment income (loss)
to average net assets:		3.33			3.43	%		1.12	%		(1.56	)%		(0.38	)%
Portfolio turnover rate		166.37	%		159.02	%		153.01	%		217.50	%		372.66	%

⁽¹⁾

Total investment return is calculated assuming a purchase of common stock at the current market price on the first day and a sale at the current market price on the last day of each period reported. Dividends and distributions, if any, are assumed for purposes of this calculation to be reinvested at the closing market price on the dividend ex-date. Total investment does not reflect brokerage commissions.

The accompanying notes are an integral part of these financial statements.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements

NOTE A: ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The Mexico Equity and Income Fund, Inc. (the “Fund”) was incorporated in Maryland on May 24, 1990, and commenced operations on August 21, 1990. The Fund is registered under the Investment Company Act of 1940, as amended, as a closed-end, non-diversified management investment company.

The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (FASB) Accounting Standard Codification Topic 946 “Financial Services—Investment Companies”.

The preparation of financial statements in accordance with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates.

Significant accounting policies are as follows:

Portfolio Valuation. Investments are stated at value in the accompanying financial statements. Listed equity securities are valued at the closing price on the exchange or market on which the security is primarily traded (the “Primary Market”) at the valuation time. If the security did not trade on the Primary Market, it shall be valued at the closing price on another comparable exchange where it trades at the valuation time. If there are no such closing prices, the security shall be valued at the mean between the most recent highest bid and lowest ask prices at the valuation time. Investments in short-term debt securities having a maturity of 60 days or less are valued at amortized cost if their term to maturity from the date of purchase was less than 60 days, or by amortizing their value on the 61st day prior to maturity if their term to maturity from the date of purchase when acquired by the Fund was more than 60 days. Other assets and securities for which no quotations are readily available will be valued in good faith at fair value using methods determined by the Board of Directors. These methods include, but are not limited to, the fundamental analytical data relating to the investment; the nature and duration of restrictions in the market in which they are traded (including the time needed to dispose of the security, methods of soliciting offers and mechanics of transfer); the evaluation of the forces which influence the market in which these securities may be purchased or sold, including the economic outlook and the condition of the industry in which the issuer participates and sum of the parts methodology. The Fund has a Valuation Committee comprised of independent directors which oversees the valuation of portfolio securities. Any securities or other assets for which market quotations are not readily available are valued at their fair value pursuant to policies and procedures adopted pursuant to Rule 2a-5 under the 1940 Act.

Investment Transactions and Investment Income. The cost of investments sold is determined by use of the specific identification method for both financial reporting and income tax purposes. Interest income, including the accretion of discount and amortization of premium on investments, is recorded on an accrual basis; dividend income is recorded on the ex-dividend date or, using reasonable diligence, when known to the Fund. The collectibility of income receivable from foreign securities is evaluated periodically, and any

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

resulting allowances for uncollectible amounts are reflected currently in the determination of investment income. There was no allowance for uncollectible amounts at July 31, 2024.

Tax Status. No provision is made for U.S. Federal income or excise taxes as it is the Fund’s intention to continue to qualify as a regulated investment company and to make the requisite distributions to its shareholders that will be sufficient to relieve it from all or substantially all U.S. Federal income and excise taxes.

The Fund is subject to the following withholding taxes on income from Mexican sources:

	Interest income on debt issued by the Mexican federal government is generally not subject to withholding. Withholding tax on interest from other debt obligations such as publicly traded bonds and loans by banks or insurance companies is at a rate of 4.9% under the tax treaty between Mexico and the United States.

	Gains realized from the sale or disposition of debt securities may be subject to a 4.9% withholding tax. Gains realized by the Fund from the sale or disposition of equity securities that are listed and traded on the Mexican Stock Exchange (“MSE”) are exempt from Mexican withholding tax if sold through the stock exchange. Gains realized on transactions outside of the MSE may be subject to withholding at a rate of 25% (20% rate prior to January 1, 2002) of the value of the shares sold or, upon the election of the Fund, at 35% (40% rate prior to January 1, 2002) of the gain. If the Fund has owned less than 25% of the outstanding stock of the issuer of the equity securities within the 12 month period preceding the disposition, then such disposition will not be subject to capital gains taxes as provided for in the treaty to avoid double taxation between Mexico and the United States.

Investment Objectives

The Fund’s investment objective is to seek high total return through capital appreciation and current income. There can be no assurance that the Fund’s objective will be achieved.

Investment Strategies

The Fund pursues its objective primarily by investing, under normal circumstances, at least 80% of the Fund’s assets in equity and convertible securities issued by Mexican companies and debt securities of Mexican issuers.

The Fund invests in equity securities, convertible securities and debt securities and may also invest in other securities such as capital development certificates, real estate investment trusts, mutual funds, exchange traded funds, preferred stocks, rights and warrants. The Fund may, without limitation, hold cash or invest in assets in money market instruments, including U.S. and non-U.S. government securities, high grade commercial paper and certificates of deposit and bankers’ acceptances issued by U.S. and non-U.S. banks.

The Adviser may invest the Fund’s cash balances in any investments it deems appropriate, subject to the restrictions set forth in below under “Fundamental Investment Restrictions” and as permitted under the

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

1940 Act. Any income earned from such investments will ordinarily be reinvested by the Fund in accordance with its investment program. Many of the considerations entering into the Adviser’s recommendations and decisions are subjective.

The Fund may, in limited circumstances, hedge against a decline in the value of the Mexican peso.

The short-term instruments in which the Fund may invest include (a) obligations of the United States Government and the Mexican Government, including the agencies or instrumentalities of each (including repurchase agreements with respect to these securities); (b) bank obligations (including certificates of deposit, time deposits and bankers’ acceptances of United States and Mexican banks denominated in U.S. dollars or pesos); (c) obligations of United States and Mexican companies that are rated no lower than A-2 by S&P or P-2 by Moody’s or the equivalent from another rating service or, if unrated, deemed to be of equivalent quality by the Adviser; and (d) shares of money market funds that are authorized to invest in (a) through (c).

Among the obligations of agencies and instrumentalities of the United States Government in which the Fund may invest are securities that are supported by the “full faith and credit” of the United States Government (such as securities of the Government National Mortgage Association), by the right of the issuer to borrow from the United States Treasury (such as those of the Export-Import Bank of the United States), by the discretionary authority of the United States Government to purchase the agency’s obligations (such as those of the Federal National Mortgage Association) or by the credit of the United States Government instrumentality itself (such as those of the Student Loan Marketing Association).

The Fund may, from time to time, take temporary defensive positions that are inconsistent with the Fund’s principal investment strategies in attempting to respond to adverse market, economic, political or other conditions. During such times, the Fund may temporarily invest up to 100% of its assets in cash or cash equivalents, including money market instruments, prime commercial paper, repurchase agreements, Treasury bills and other short-term obligations of the U.S. Government, its agencies or instrumentalities. In these and in other cases, the Fund may not achieve its investment objective.

Portfolio Investments

Common Stocks

The Fund will invest in common stocks. Common stocks represent an ownership interest in an issuer. While offering greater potential for long-term growth, common stocks are more volatile and riskier than some other forms of investment in short-term periods. Common stock prices fluctuate for many reasons, including adverse exogenous macro and systemic events, abrupt change in companies’ revenues due to commodity cycle or epidemic diseases, capital allocation, a period of disappointing financial reporting economics, fiscal, and monetary policies in the U.S.A, and Mexico.

Capital Development Certificates

Capital development certificates are hybrid instruments that may include debt and equity. Capital development certificates grant their holders the right to variable income arising from various projects and/or companies.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Convertible Securities

Initially, the Fund’s management anticipated that the Fund would acquire convertible debt securities in privately negotiated transactions. However, because of the extremely limited number of convertible debt securities issued by Mexican companies, the Fund has not acquired convertible debt securities of Mexican companies for the last 25 years. However, the Fund may acquire convertible debt securities in Mexican companies in the future if and when they become available. A convertible debt security is a bond, debenture or note that may be converted into or exchanged for, or may otherwise entitle the holder to purchase, a prescribed amount of common stock or other equity security of the same or a different Mexican company within a particular period of time at a specified price or formula. A convertible debt security entitles the holder to receive interest paid or accrued on debt until the convertible security matures or is redeemed, converted or exchanged. Before conversion, convertible debt securities have characteristics similar to nonconvertible debt securities in that they ordinarily provide for a fixed stream of income with generally higher yields than those of stocks of the same or similar issuers. Convertible debt securities rank senior to stock in a corporation’s capital structure and, therefore, generally entail less risk than the corporation’s stock. Given the volatility of the Mexican securities market and the pricing of securities in Mexico, a significant portion of the value of a Mexican convertible debt security may be derived from the conversion feature rather than the fixed income feature.

The Fund defines debt securities (other than convertible debt securities) to mean bonds, notes, bills and debentures. The Fund’s investments in debt securities of Mexican issuers include debt securities issued by private Mexican companies and by the Mexican Government and its agencies and instrumentalities. These debt securities may be denominated either in pesos or in U.S. dollars.

Corporate Bonds, Government Debt Securities and Other Debt Securities

The Fund may invest in corporate bonds, debentures and other debt securities or in investment companies which hold such instruments. Bonds and other debt securities generally are issued by corporations and other issuers to borrow money from investors. The issuer pays the investor a fixed rate of interest and normally must repay the amount borrowed on or before maturity. Certain debt securities are “perpetual” in that they have no maturity date.

The Fund will invest in government debt securities. These securities may be U.S. dollar-denominated or non-U.S. dollar-denominated and include: (a) debt obligations issued or guaranteed by foreign national, provincial, state, municipal or other governments with taxing authority or by their agencies or instrumentalities; and (b) debt obligations of supranational entities. Government debt securities include: debt securities issued or guaranteed by governments, government agencies or instrumentalities and political subdivisions; debt securities issued by government owned, controlled or sponsored entities; interests in entities organized and operated for the purpose of restructuring the investment characteristics issued by the above noted issuers; or debt securities issued by supranational entities such as the World Bank or the European Union.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Exchange Traded Funds

The Fund may invest in Exchange Traded Funds (“ETFs”), which are investment companies that aim to track or replicate a desired index, such as a sector, market or global segment. ETFs are passively managed and their shares are traded on a national exchange. ETFs do not sell individual shares directly to investors and only issue their shares in large blocks known as “creation units.” The investor purchasing a creation unit may sell the individual shares on a secondary market. Therefore, the liquidity of ETFs depends on the adequacy of the secondary market. There can be no assurance that an ETF’s investment objective will be achieved, as ETFs based on an index may not replicate and maintain exactly the composition and relative weightings of securities in the index. ETFs are subject to the risks of investing in the underlying securities. The Fund, as a holder of the securities of the ETF, will bear its pro rata portion of the ETF’s expenses, including advisory fees. These expenses are in addition to the direct expenses of the Fund’s own operations.

Real Estate Investment Trusts

The Fund may invest in securities of Real Estate Investment Trusts (“REITs”). REITs are trusts that specialize in acquiring, holding and managing residential, commercial or industrial real estate. A REIT is not taxed at the entity level on income distributed to its shareholders or unitholders if it distributes to shareholders or unitholders at least 90% of its taxable income for each taxable year and complies with regulatory requirements relating to its organization, ownership, assets and income.

Other Securities

Although it has no current intention do so to any material extent, the Fund may determine to invest the Fund’s assets in some or all of the following securities.

Forward Currency Contracts

The Fund may, in limited circumstances, hedge against a decline in the value of the Mexican peso. On March 19, 1995, Banco de Mexico approved the establishment of over-the-counter forward and option contracts in Mexico on the new peso between banks and their clients. Also, Banco de Mexico authorized the issuance and trading of futures contracts in respect of the new peso on the Chicago Mercantile Exchange (“CME”). Trading of new peso futures contracts began on the CME on April 25, 1995.

The Fund will conduct any forward currency exchange transactions, which are considered derivative transactions, only for hedging and not speculation. The risk of future currency devaluations and fluctuations should be carefully considered by investors in determining whether to purchase shares of the Fund. Although the Fund will value its assets daily in terms of U.S. dollars, it does not intend physically to convert its holdings of pesos into U.S. dollars on a daily basis. The Fund will do so from time to time, and investors should be aware of the costs of currency conversion. Although foreign exchange dealers do not charge a fee for conversion, they do realize a profit based on the difference (the “spread”) between the prices at which they are buying and selling various currencies. Thus, a dealer may offer to sell a foreign currency to the Fund at one rate, while offering a lesser rate of exchange should the Fund desire to resell that currency to the dealer.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

A forward currency contract involves an obligation to purchase or sell a specific currency at a future date, which may be any fixed number of days from the date of the contract agreed upon by the parties, at a price set at the time of the contract. The Fund’s dealings in forward currency contracts will be limited to hedging involving either specific transactions or portfolio positions. Transaction hedging is the purchase or sale of forward currency contracts with respect to specific receivables or payables of the Fund generally arising in connection with the purchase or sale of its portfolio securities or in anticipation of receipt of dividend or interest payments. Position hedging is the purchase or sale of forward currency contracts with respect to portfolio security positions denominated or quoted in the currency.

The Fund may not position hedge with respect to a particular currency to an extent greater than the aggregate market value (at the time of making such purchase or sale) of the securities held in its portfolio denominated or quoted in or currently convertible into that particular currency. If the Fund enters into a position hedging transaction, the custodian of the Fund’s assets being hedged will place cash or readily marketable securities in a segregated account of the Fund in an amount equal to the value of the Fund’s total assets committed to the consummation of the forward contract. If the value of the securities placed in the segregated account declines, additional cash or securities will be placed in the account so that the value of the account will equal the amount of the Fund’s commitment with respect to the contract.

The Fund may enter into forward currency contracts in several circumstances. When the Fund enters into a contract for the purchase or sale of securities denominated in a foreign currency, or when the Fund anticipates the receipt in a foreign currency of interest or dividend payments, the Fund may desire to “lock-in” the U.S. dollar price of the security or the U.S. dollar equivalent of such interest or dividend payment, as the case may be. By entering into a forward contract for a fixed amount of U.S. dollars for the purchase or sale of the amount of foreign currency involved in the underlying transactions, the Fund will be able to protect itself against a possible loss resulting from an adverse change in the relationship between the U.S. dollar and the subject foreign currency during the period between the date on which the security is purchased or sold, or on which the dividend payment is declared, and the date on which such dividend or interest payment is to be received.

At or before the maturity of a forward currency contract, the Fund may either sell a portfolio security and make delivery of the currency, or retain the security and offset its contractual obligation to deliver the currency by purchasing a second contract pursuant to which the Fund will obtain, on the same maturity date, the same amount of the currency that it is obligated to deliver. If the Fund retains the portfolio security and engages in an offsetting transaction, the Fund, at the time of execution of the offsetting transaction, will incur a gain or a loss to the extent that movement has occurred in forward contract prices. The use of forward currency contracts does not eliminate fluctuation in the underlying prices of the securities, but it does establish a rate of exchange that can be achieved in the future. In addition, although forward currency contracts limit the risk of loss due to a decline in the value of the hedged currency, at the same time they limit any potential

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

gain that might result should the value of the currency increase. If a devaluation is generally anticipated, the Fund may not be able to contract to sell the currency at a price above the devaluation level it anticipates.

The cost to the Fund of engaging in currency transactions either on a spot or forward basis will vary with factors such as the currency involved, the length of the contract period and the market conditions then prevailing. Because transactions in currency exchange are usually conducted on a principal basis, no fees or commissions are involved, although the price charged in the transaction includes a dealer’s markup.

Certain provisions of the Code may limit the extent to which the Fund may enter into the foreign currency transactions described above. These transactions may also affect the character and timing of income, and the amount of gain or loss recognized by the Fund and its stockholders for U.S. federal income tax purposes.

Investment Companies

The Fund may invest in the securities of other investment companies (“underlying funds”), including those that invest a substantial portion of their assets in Mexican securities, to the extent permitted by, and subject to the conditions imposed by, the 1940 Act and the rules and regulations thereof. By investing in an investment company, the Fund bears a ratable share of the investment company’s expenses, as well as continuing to bear the Fund’s advisory and administrative fees with respect to the amount of the investment. Investment companies are subject to the risks of investing in the underlying securities. Under the 1940 Act, banks organized outside of the United States are deemed to be investment companies, although the SEC has adopted a rule which would permit the Fund to invest in the securities of foreign commercial banks, under certain circumstances, without regard to the percentage limitations of the 1940 Act.

The Fund may be subject to the risks of the securities and other instruments described herein through its own direct investments and indirectly through investments in the underlying funds, as those recently included in the “Bolsa”, named FIBRA E, (similar to a REIT in the U.S.) which corresponds to a Mexican mechanism to finance infrastructure, energy and long term projects, as well as private equity, regulated by the Comisión Nacional Bancaria y de Valores (corresponding SEC in the U.S.).

Illiquid Securities

Illiquid securities are securities that are not readily marketable. Illiquid securities include securities that have a low daily turnover or that trade on odd lots or trading-block among small and medium portfolio managers referred to as specialists but do not provide liquidity to trade at reasonable fair value. Illiquid securities usually present a high spread between the bid and ask quotes. If the Fund sells an illiquid security during a period with adverse market conditions, the Fund might obtain a less favorable price. Illiquid securities also include securities that have legal or contractual restrictions on resale, and repurchase agreements maturing in more than seven days. The Fund may invest up to 15% of the value of its total assets in illiquid securities. Restricted securities for which no market exists and other illiquid investments are valued at fair value as determined in accordance to policies and procedures adopted pursuant to Rule 2a-5 under the 1940 Act and periodically reviewed by the Board of Directors. At July 31, 2024 the Fund held 1.9% of its total net assets in illiquid positions.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Rule 144A Securities

The Fund may invest in restricted securities that are eligible for resale pursuant to Rule 144A under the Securities Act of 1933, as amended, (the “1933 Act”). Generally, Rule 144A establishes a safe harbor from the registration requirements of the 1933 Act for resale by large institutional investors of securities that are not publicly traded. The Adviser determines the liquidity of the Rule 144A securities according to the Fund’s pricing policy and guidelines adopted by the Board of Directors. The Board of Directors monitors the application of those guidelines and procedures. Securities eligible for resale pursuant to Rule 144A, which are determined to be liquid, are not subject to the Fund’s 15% limit on investments in illiquid securities.

Preferred Stocks

The Fund may invest in preferred stocks. Preferred stock, like common stock, represents an equity ownership in an issuer. Generally, preferred stock has a priority of claim over common stock in dividend payments and upon liquidation of the issuer. Unlike common stock, preferred stock does not usually have voting rights. Preferred stock in some instances is convertible into common stock. Although they are equity securities, preferred stocks have characteristics of both debt and common stock. Like debt, their promised income is contractually fixed. Like common stock, they do not have rights to precipitate bankruptcy proceedings or collection activities in the event of missed payments. Other equity characteristics are their subordinated position in an issuer’s capital structure and that their quality and value are heavily dependent on the profitability of the issuer rather than on any legal claims to specific assets or cash flows.

Distributions on preferred stock must be declared by the board of directors and may be subject to deferral, and thus they may not be automatically payable. Income payments on preferred stocks may be cumulative, causing dividends and distributions to accrue even if not declared by the company’s board or otherwise made payable, or they may be non-cumulative, so that skipped dividends and distributions do not continue to accrue. There is no assurance that dividends on preferred stocks in which the Fund invests will be declared or otherwise made payable. The Fund may invest in non-cumulative preferred stock, although the Adviser may consider, among other factors, their non-cumulative nature in making any decision to purchase or sell such securities.

Shares of preferred stock have a liquidation value that generally equals the original purchase price at the date of issuance. The market values of preferred stock may be affected by favorable and unfavorable changes impacting the issuers’ industries or sectors, including companies in the utilities and financial services sectors, which are prominent issuers of preferred stock. They may also be affected by actual and anticipated changes or ambiguities in the tax status of the security and by actual and anticipated changes or ambiguities in tax laws, such as changes in corporate and individual income tax rates, and in the dividends received deduction for corporate taxpayers or the lower rates applicable to certain dividends.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

after an initial period of call protection in which the stock is not redeemable. Thus, in declining interest rate environments in particular, the Fund’s holdings of higher dividend -paying preferred stocks may be reduced and the Fund may be unable to acquire securities paying comparable rates with the redemption proceeds.

Warrants

The Fund may invest in equity and index warrants of domestic and international issuers. Equity warrants are securities that give the holder the right, but not the obligation, to subscribe for equity issues of the issuing company or a related company at a fixed price either on a certain date or during a set period. Changes in the value of a warrant do not necessarily correspond to changes in the value of its underlying security. The price of a warrant may be more volatile than the price of its underlying security, and a warrant may offer greater potential for capital appreciation as well as capital loss. Warrants do not entitle a holder to dividends or voting rights with respect to the underlying security and do not represent any rights in the assets of the issuing company. A warrant ceases to have value if it is not exercised prior to its expiration date. These factors can make warrants more speculative than other types of investments. The sale of a warrant results in a long or short-term capital gain or loss depending on the period for which the warrant is held.

RISK FACTORS

An investment in the Fund is not guaranteed to achieve its investment objective; is not a deposit with a bank; is not insured, endorsed or guaranteed by the Federal Deposit Insurance Corporation or any other government agency; and is subject to investment risks. The value of the Fund’s investments will increase or decrease based on changes in the prices of the investments it holds. You could lose money by investing in the Fund. By itself, the Fund does not constitute a balanced investment program. You should consider carefully the following principal and non-principal risks before investing in the Fund. There may be additional risks that the Fund does not currently foresee or consider material. You may wish to consult with your legal or tax advisors, before deciding whether to invest in the Fund. This section describes the risk factors associated with investment in the Fund specifically, as well as those factors generally associated with investment in an investment company with investment objectives, investment policies, capital structure or trading markets similar to the Fund’s. Each risk summarized below is a risk of investing in the Fund and different risks may be more significant at different times depending upon market conditions or other factors.

The Fund may invest in securities of other investment companies (“underlying funds”). The Fund may be subject to the risks of the securities and other instruments described below through its own direct investments and indirectly through investments in the underlying funds.

Principal Risks

Investments in Foreign Securities Risks.

The Fund invests in the universe of Mexican securities market. Investing in Mexican securities presents political, regulatory and economic risks in some ways similar to those that face a re-emerging country and a developing county; and different in kind and degree from the risks presented by investing in the U.S. financial markets or any other fairly comparable emerging country in the Latin American region, pertaining

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

to the emerging market risk. Some of these risks may include devaluation and/or appreciation of the exchange rate of the Mexican Peso, greater market price volatility, substantially less liquidity, controls on foreign investment, and limitations on repatriation of invested capital. Unlike U.S. issuers which are required to comply GAAP accounting policy standards, Mexican issuers comply with mandatory regulation to IFR’s accounting standards and policies. Additional risks of investing in foreign securities are detailed below.

Market Illiquidity, Volatility. Although one of the largest in Latin America by market capitalization, the Bolsa Mexicana de Valores, S.A. de C.V. (the “Mexican Stock Exchange” or “Bolsa”) is substantially smaller, less liquid and more volatile than the major securities markets in the United States. In addition, trading on the Mexican Stock Exchange is concentrated. Thus, the performance of the Mexican Stock Exchange, as further described below, may be highly dependent on the performance of a few issuers. Additionally, prices of equity securities traded on the Mexican Stock Exchange are generally more volatile than prices of equity securities traded on the New York Stock Exchange. The combination of price volatility and the relatively limited liquidity of the Mexican Stock Exchange may have an adverse impact on the investment performance of the Fund.

Market Corrections. Although less so in recent times, the Mexican securities market has been subject to periodic severe market corrections. A recent correction in the Bolsa’s Index occurred at the cancellation of the latest state of the ongoing art construction of a new airport by the new administration in Mexico starting in 2017. Due to the high concentration of investors, issuers and intermediaries in the Mexican securities market and the generally high volatility of the Mexican economy, the Mexican securities market may be subject to severe market corrections than more broadly based markets. As is the case with investing in any securities market, there can be no assurance that market corrections will not occur again.

The Mexican Economy. In the past, the Mexican economy has experienced peso devaluations, significant rises in inflation and domestic interest rates and other economic instability and there can be no assurance that it will not experience such instability in the future.

Common Stock Risk. The Fund invests in common stocks. Common stocks represent an ownership interest in a company. The Fund may also invest in securities that can be exercised for or converted into common stocks (such as convertible preferred stock). Common stocks and similar equity securities are more volatile and riskier than some other forms of investments. Therefore, the value of your investment in the Fund may sometimes decrease instead of increase. Common stock prices fluctuate for many reasons, including adverse events such as unfavorable earnings reports, changes in investors’ perceptions of the financial condition of an issuer, the general condition of the relevant stock market or when political or economic events affecting the issuers occur. In addition, common stock prices may be sensitive to rising interest rates, as the costs of capital rise and borrowing costs increase for issuers. Because convertible securities can be converted into equity securities, their values will normally increase or decrease as the values of the underlying equity securities increase or decrease. The common stocks in which the Fund invests are structurally subordinated to preferred

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

securities, bonds and other debt instruments in a company’s capital structure in terms of priority to corporate income and assets and, therefore, will be subject to greater risk than the preferred securities or debt instruments of such issuers.

Convertible Securities Risk. The Fund may acquire convertible debt securities in Mexican companies. A convertible debt security is a bond, debenture or note that may be converted into or exchanged for, or may otherwise entitle the holder to purchase, a prescribed amount of common stock or other equity security of the same or a different Mexican company within a particular period of time at a specified price or formula. A convertible debt security entitles the holder to receive interest paid or accrued on debt until the convertible security matures or is redeemed, converted or exchanged. Before conversion, convertible debt securities have characteristics similar to nonconvertible debt securities in that they ordinarily provide for a fixed stream of income with generally higher yields than those of stocks of the same or similar issuers. Convertible debt securities rank senior to stock in a corporation’s capital structure and, therefore, generally entail less risk than the corporation’s stock. Given the volatility of the Mexican securities market and the pricing of securities in Mexico, a significant portion of the value of a Mexican convertible debt security may be derived from the conversion feature rather than the fixed income feature.

The value of a convertible security, including, for example, a warrant, is a function of its investment value (determined by its yield in comparison with the yields of other securities of comparable maturity and quality that do not have a conversion privilege) and its conversion value (the security’s worth, at market value, if converted into the underlying common stock). The investment value of a convertible security is influenced by changes in interest rates, with investment value declining as interest rates increase and increasing as interest rates decline. The credit standing of the issuer and other factors may also have an effect on the convertible security’s investment value. The conversion value of a convertible security is determined by the market price of the underlying common stock. If the conversion value is low relative to the investment value, the price of the convertible security is governed principally by its investment value. Generally, the conversion value decreases as the convertible security approaches maturity. To the extent the market price of the underlying common stock approaches or exceeds the conversion price, the price of the convertible security will be increasingly influenced by its conversion value. A convertible security generally will sell at a premium over its conversion value by the extent to which investors place value on the right to acquire the underlying common stock while holding a fixed income security. A convertible security may be subject to redemption at the option of the issuer at a price established in the convertible security’s governing instrument. If a convertible security held by the Fund is called for redemption, the Fund will be required to permit the issuer to redeem the security, convert it into the underlying common stock or sell it to a third party. Any of these actions could have an adverse effect on the Fund’s ability to achieve its investment objective.

Small and Medium Capitalization Company Risk. The Fund may invest in securities without regard to market capitalization. Compared to investment companies that focus only on large capitalization companies, the Fund’s share price may be more volatile because it also invests in small and medium capitalization

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

companies. Compared to large companies, small and medium capitalization companies are more likely to have (i) more limited product lines or markets and less mature businesses, (ii) fewer capital resources, (iii) more limited management depth and (iv) shorter operating histories. Further, compared to large capitalization companies, the securities of small and medium capitalization companies are more likely to experience sharper swings in market values, be harder to sell at times and at prices that the Adviser believes appropriate.

Market Risk. Overall market risk may affect the value of individual instruments in which the Fund invests. The Fund is subject to the risk that the securities markets will move down, sometimes rapidly and unpredictably, based on overall economic conditions and other factors, which may negatively affect the Fund’s performance. Factors such as domestic and foreign (non-U.S.) economic growth and market conditions, real or perceived adverse economic or political conditions, inflation, changes in interest rate levels, lack of liquidity in the markets, volatility in the securities markets, adverse investor sentiment affect the securities markets and political vents affect the securities markets. Securities markets also may experience long periods of decline in value. When the value of the Fund’s investments goes down, your investment in the Fund decreases in value and you could lose money.

Local, state, regional, national or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the Fund and its investments and could result in decreases to the Fund’s net asset value. Political, geopolitical, natural and other events, including war, military conflicts, terrorism, trade disputes, government shutdowns, market closures, natural and environmental disasters, epidemics, pandemics and other public health crises and related events and governments’ reactions to such events have led, and in the future may lead, to economic uncertainty, decreased economic activity, increased market volatility and other disruptive effects on U.S. and global economies and markets. Such events may have significant adverse direct or indirect effects on the Fund and its investments. For example, a widespread health crisis such as a global pandemic could cause substantial market volatility, exchange trading suspensions and closures, impact the ability to complete redemptions, and affect Fund performance. A health crisis may exacerbate other pre-existing political, social and economic risks. In addition, the increasing interconnectedness of markets around the world may result in many markets being affected by events or conditions in a single country or region or events affecting a single or small number of issuers.

The Coronavirus (COVID-19) pandemic caused significant economic disruption in recent years as countries worked to limit the negative health impacts of the virus. While the virus appears to have entered an endemic stage, significant outbreaks or new variants present a continued risk to the global economy.

Market Discount from Net Asset Value Risk. Shares of closed-end investment companies frequently trade at a discount from their net asset value (“NAV”). Because the market price of the Shares is determined by factors such as relative supply of and demand for the Shares in the market, general market and economic conditions, and other factors beyond the control of the Fund, the Fund cannot predict whether the Shares will trade at, below or above net asset value.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Management Risk. The Fund is subject to management risk because it is an actively managed portfolio. The Fund’s successful pursuit of its investment objective depends upon the Adviser’s ability to find and exploit market inefficiencies with respect to undervalued securities. Such situations occur infrequently and may be difficult to predict, and may not result in a favorable pricing opportunity for the Fund. The Adviser’s sector allocation and stock selection decisions might produce losses or cause the Fund to underperform its benchmark or underperform when compared to other funds with similar investment goals. If one or more key individuals leave the employment of the Adviser, the Adviser may not be able to hire qualified replacements, or may require an extended time to do so. This could prevent the Fund from achieving its investment objective.

Real Estate Investment Trust (“REIT”) Risk. Investments in REITs will subject the Fund to various risks. The first, real estate industry risk, is the risk that REIT share prices will decline because of adverse developments affecting the real estate industry and real property values. In general, real estate values can be affected by a variety of factors, including supply and demand for properties, the economic health of the country or of different regions, and the strength of specific industries that rent properties. REITs often invest in highly leveraged properties. The second risk is the risk that returns from REITs, which typically are small or medium capitalization stocks, will trail returns from the overall stock market. The third, interest rate risk, is the risk that changes in interest rates may hurt real estate values or make REIT shares less attractive than other income producing investments. REITs are also subject to heavy cash flow dependency, defaults by borrowers and self-liquidation.

Qualification as a REIT under the Code in any particular year is a complex analysis that depends on a number of factors. There can be no assurance that the entities in which the Fund invests with the expectation that they will be taxed as a REIT will qualify as a REIT. An entity that fails to qualify as a REIT would be subject to a corporate level tax, would not be entitled to a deduction for dividends paid to its stockholders and would not pass through to its stockholders the character of income earned by the entity. If the Fund were to invest in an entity that failed to qualify as a REIT, such failure could drastically reduce the Fund’s yield on that investment.

REITs can be classified as equity REITs, mortgage REITs and hybrid REITs. Equity REITs invest primarily in real property and earn rental income from leasing those properties. They may also realize gains or losses from the sale of properties. Equity REITs will be affected by conditions in the real estate rental market and by changes in the value of the properties they own. Mortgage REITs invest primarily in mortgages and similar real estate interests and receive interest payments from the owners of the mortgaged properties. They are paid interest by the owners of the financed properties. Mortgage REITs will be affected by changes in creditworthiness of borrowers and changes in interest rates. Hybrid REITs invest both in real property and in mortgages. Equity and mortgage REITs are dependent upon management skills, may not be diversified and are subject to the risks of financing projects.

Dividends paid by REITs will not generally qualify for the reduced U.S. federal income tax rates applicable to qualified dividends under the Code.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

The Fund’s investment in REITs may include an additional risk to Stockholders. Some or all of a REIT’s annual distributions to its investors may constitute a non-taxable return of capital. Any such return of capital will generally reduce the Fund’s basis in the REIT investment, but not below zero. To the extent the distributions from a particular REIT exceed the Fund’s basis in such REIT, the Fund will generally recognize gain. In part because REIT distributions often include a nontaxable return of capital, Fund distributions to Stockholders may also include a nontaxable return of capital. Stockholders that receive such a distribution will also reduce their tax basis in their shares of the Fund, but not below zero. To the extent the distribution exceeds a Stockholder’s basis in the Fund shares, such Stockholder will generally recognize capital gain.

Exchange Traded Funds Risk. The Fund may invest in exchange-traded funds, which are investment companies that, in some cases, aim to track or replicate a desired index, such as a sector, market or global segment. ETFs are passively or, to a lesser extent, actively managed and their shares are traded on a national exchange. ETFs do not sell individual shares directly to investors and only issue their shares in large blocks known as “creation units.” The investor purchasing a creation unit may sell the individual shares on a secondary market. Therefore, the liquidity of ETFs depends on the adequacy of the secondary market. There can be no assurance that an ETF’s investment objective will be achieved, as ETFs based on an index may not replicate and maintain exactly the composition and relative weightings of securities in the index. ETFs are subject to the risks of investing in the underlying securities. The Fund, as a holder of the securities of the ETF, will bear its pro rata portion of the ETF’s expenses, including advisory fees. These expenses are in addition to the direct expenses of the Fund’s own operations.

Shares of Other Investment Companies. The Fund may invest in shares of other investment companies as a means to pursue the Fund’s investment objective. As a result of this policy, your cost of investing will generally be higher than the cost of investing directly in the underlying investment company shares. You will indirectly bear fees and expenses charged by the underlying investment companies in addition to the Fund’s direct fees and expenses. Furthermore, the use of this strategy could affect the timing, amount and character of distributions to you and therefore may increase the amount of taxes payable by you.

Restricted or Illiquid Securities Risks. The Fund may invest up to 15% of its total assets in illiquid securities. Illiquid securities may offer a higher yield than securities which are more readily marketable, but they may not always be marketable on advantageous terms. The sale of illiquid securities often requires more time and results in higher brokerage charges or dealer discounts than does the sale of securities eligible for trading on national securities exchanges or in the over-the-counter markets. A security traded in the U.S. that is not registered under the Securities Act will not be considered illiquid if Fund management determines that an adequate investment trading market exists for that security. However, there can be no assurance that a liquid market will exist for any security at a particular time. The Fund may invest in securities that are subject to restrictions on resale, such as Rule 144A securities. Rule 144A securities are securities that have been privately placed but are eligible for purchase and sale by certain qualified institutional buyers under Rule 144A under the Securities Act of 1933. Under the supervision of the Board of Directors, the Adviser

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

will determine whether securities purchased under Rule 144A are illiquid. If it is determined that qualified institutional buyers are unwilling to purchase these securities, the percent of Fund assets invested in illiquid securities would increase.

Issuer Specific Changes Risk. Changes in the financial condition of an issuer, changes in the specific economic or political conditions that affect a particular type of security or issuer, and changes in general economic or political conditions can affect the credit quality or value of an issuer’s securities. Lower-quality debt securities tend to be more sensitive to these changes than higher-quality debt securities.

Non-Principal Risks

In addition to the principal risks set forth above, the following additional risks may apply to an investment in the Fund.

Anti-Takeover Provisions Risk. The Fund’s Charter and Bylaws include provisions that could limit the ability of other persons or entities to acquire control of the Fund or to cause it to engage in certain transactions or to modify its structure.

Borrowing Risks. The Fund is not restricted from borrowing money from banks or other financial institutions to purchase securities, commonly referred to as “leveraging.” In the event the Fund does engage in such borrowing activities, the Fund’s exposure to fluctuations in the prices of these securities is increased in relation to the Fund’s capital. Fund borrowing activities will exaggerate any increase or decrease in the Fund’s net asset value. In addition, the interest which the Fund must pay on borrowed money, together with any additional fees to maintain a line of credit or any minimum average balances required to be maintained, are additional costs which will reduce or eliminate any net investment profits. Unless profits on assets acquired with borrowed funds exceed the costs of borrowing, the use of borrowing will diminish the Fund’s investment performance compared with what it would have been without borrowing. Leverage, including borrowing, may cause the Fund to be more volatile than if it had not been leveraged.

Changes in Policies Risk. The Fund’s Directors may change the Fund’s investment objective, investment strategies and non-fundamental investment restrictions without stockholder approval, except as otherwise indicated.

Credit Risk. Debt obligations are generally subject to the risk that the issuer may be unable to make principal and interest payments when they are due. There is also the risk that the securities could lose value because of a loss of confidence in the ability of the borrower to pay back debt. Non-investment grade debt — also known as “high-yield bonds” and “junk bonds” — have a higher risk of default and tend to be less liquid than higher-rated securities. These lower rated securities have speculative characteristics and changes in economic conditions or other circumstances are more likely to lead to a weakened capacity of those issuers to make principal or interest payments, as compared to issuers of more highly rated securities.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Defensive Position Risk. During periods of adverse market or economic conditions, the Fund may temporarily invest all or a substantial portion of its net assets in cash or cash equivalents. The Fund would not be pursuing its investment objective in these circumstances and could miss favorable market developments.

High Portfolio Turnover Rate Risk. The Fund’s portfolio management may result in high turnover rates which may increase short-term capital appreciation and increase brokerage commission costs. If the Fund has a higher portfolio turnover rate, then the Fund’s performance could be negatively impacted due to the increased expenses incurred as a result of the higher brokerage commissions. Rapid portfolio turnover also exposes stockholders to a higher current realization of capital gains and this could cause stockholders to pay higher taxes. For the Fund’s most recent fiscal year ended July 31, 2024, the portfolio turnover rate was 166.37%.

Initial Public Offerings Risks. The Fund may purchase securities of companies in initial public offerings. Special risks associated with these securities may include a limited number of shares available for trading, unseasoned trading, lack of investor knowledge of the company and limited operating history. These factors may contribute to substantial price volatility for the shares of these companies. The limited number of shares available for trading in some initial public offerings may make it more difficult for the Fund to buy or sell significant amounts of shares without unfavorable impact on prevailing market prices. Some companies in initial public offerings are involved in relatively new industries or lines of business, which may not be widely understood by investors. Some of these companies may be undercapitalized or regarded as developmental stage companies without revenues or operating income, or the near-term prospects of achieving them.

Interest Rate Risk. Fixed income securities are subject to the risk that the securities could lose value because of interest rate changes. In general, the price of a debt security can fall when interest rates rise and can rise when interest rates fall. Debt obligations with longer maturities sometimes offer higher yields, but are subject to greater price shifts as a result of interest rate changes than debt obligations with shorter maturities. The longer the maturity of the security, the greater the impact a change in interest rates could have on the security’s price. In addition, short-term and long-term interest rates do not necessarily move in the same amount or the same direction. Short-term securities tend to react to changes in short-term interest rates and long-term securities tend to react to changes in long-term interest rates.

Preferred Stock Risk. The Fund may invest in preferred stocks. Preferred stock, like common stock, represents an equity ownership in an issuer. Generally, preferred stock has a priority of claim over common stock in dividend payments and upon liquidation of the issuer. Unlike common stock, preferred stock does not usually have voting rights. Preferred stock in some instances is convertible into common stock. Although they are equity securities, preferred stocks have characteristics of both debt and common stock. Like debt, their promised income is contractually fixed. Like common stock, they do not have rights to precipitate bankruptcy proceedings or collection activities in the event of missed payments. Other equity characteristics

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

are their subordinated position in an issuer’s capital structure and that their quality and value are heavily dependent on the profitability of the issuer rather than on any legal claims to specific assets or cash flows.

Investment in preferred stocks carries risks, including credit risk, deferral risk, redemption risk, limited voting rights, risk of subordination and lack of liquidity. Fully taxable or hybrid preferred securities typically contain provisions that allow an issuer, at its discretion, to defer distributions for up to 20 consecutive quarters. Distributions on preferred stock must be declared by the board of directors and may be subject to deferral, and thus they may not be automatically payable. Income payments on preferred stocks may be cumulative, causing dividends and distributions to accrue even if not declared by the company’s board or otherwise made payable, or they may be non-cumulative, so that skipped dividends and distributions do not continue to accrue. There is no assurance that dividends on preferred stocks in which the Fund invests will be declared or otherwise made payable. The Fund may invest in non-cumulative preferred stock, although the Fund’s Adviser would consider, among other factors, their non-cumulative nature in making any decision to purchase or sell such securities.

Because the claim on an issuer’s earnings represented by preferred stock may become onerous when interest rates fall below the rate payable on the stock or for other reasons, the issuer may redeem preferred stock, generally after an initial period of call protection in which the stock is not redeemable. Thus, in declining interest rate environments in particular, the Fund’s holdings of higher dividend paying preferred stocks may be reduced and the Fund may be unable to acquire securities paying comparable rates with the redemption proceeds. In the event of a redemption, the Fund may not be able to reinvest the proceeds at comparable rates of return.

Summary of Fair Value Exposure at July 31, 2024. The Fund follows the FASB ASC Topic 820 hierarchy, under which various inputs are used in determining the value of the Fund’s investments.

The basis of the hierarchy is dependent upon various “inputs” used to determine the value of the Fund’s investments. These inputs are summarized in the three broad levels listed below:

Level 1 –

Unadjusted quoted prices in active markets for identical assets or liabilities that the company has the ability to access.

THE MEXICO EQUITY AND INCOME FUND, INC.

	July 31, 2024
Notes to Financial Statements (continued)

Level 2 –	Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

Level 3 –	Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the company’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets, and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

The inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level in the fair value hierarchy within which the fair value measurement falls in its entirety, is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities. The following is a summary of the inputs used to value the Fund’s investments carried at fair value as of July 31, 2024:

Level 1

Level 2

Level 3

Total

Equity*

Common Stocks

49,093,358

SEC Form N-CSR filed by Mexico Equity and Income Fund Inc.