Which of the Following Is a Drawback of Mutual Funds

question 49

Multiple Choice

Which of the following is a drawback of mutual funds?

• A) There is no scope for financial diversification.
• B) The professional management touted by many funds does not come cheap.
• C) Most investors do not find a fund that is a good match based on their investment goals.
• D) Withdrawing funds from a mutual fund is extremely difficult.

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Definitions:

Marginal Revenue

The increase in revenue that results from the sale of one additional unit of a product or service.

Industry Equilibrium Price

The price at which the quantity of goods supplied equals the quantity of goods demanded in an industry.

Marginal Revenue

The extra revenue received from selling an additional unit of a product or service.

Profit-Maximizing

A process or strategy aiming to achieve the highest possible profits from business operations.