Important Reasons for Constructing a Policy Statement Include

question 40

Multiple Choice

Important reasons for constructing a policy statement include:

• A) Helps investors decide on realistic investment goals
• B) Create a standard by which to judge the performance of the portfolio manager
• C) Develop an instrument to judge risk
• D) Choices a and b
• E) All of the above

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Definitions:

Liable

Being legally responsible for something, typically referring to the obligation to compensate for loss or damage.

Disclosed Principal

A principal whose identity is known to a third party at the time the agent makes a contract with the third party.

Liable

Legally responsible or obligated, often in reference to the duty to compensate for harm or loss caused by one's actions or omissions.

Scope of Authority

The scope of authority delineates the range of actions or decisions that an individual or entity, such as an employee or agent, is officially empowered to make on behalf of another party or organization.