A Mutual Fund Is a Good Way for an Investor

question 241

Multiple Choice

A mutual fund is a good way for an investor to diversify in investment because:

• A) a mutual fund consists of a large number of stocks so the cost of buying all of them at the same time is lower.
• B) when the prices of risky stocks go up, the prices of less risky stocks must go down.
• C) not all stock prices move up or down at the same time.
• D) there are many buyers of a mutual fund so that the risk is spread across all the buyers.

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Definitions:

Adult Learning Process

The methods and strategies by which adults acquire new knowledge, skills, attitudes, or values, often differing from traditional pedagogical approaches.

Central Processing Unit

The primary component of a computer that performs most of the processing inside a computer.

Random Access Memory

A type of computer memory that can be accessed randomly, allowing data to be stored and read in any order, significantly speeding up processes.

Relational Database

A type of database structured to recognize relations among stored items of information, using tables.