One Reason That Passively Managed Mutual Funds Have Grown in Popularity

question 69

Multiple Choice

One reason that passively managed mutual funds have grown in popularity relative to actively managed mutual funds is that

• A) passive fund expense ratios are lower.
• B) passive fund returns are always higher.
• C) active funds are too diverse.
• D) none of these

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Definitions:

Service Departments

Units within an organization that support the production process but do not directly engage in manufacturing activities.

Operating Departments

Operating departments are units within an organization directly involved in its primary revenue-generating activities, such as production or sales departments.

Maintenance Department

A division within a company responsible for maintaining equipment, facilities, and systems to ensure efficient and safe operations.

Variable Costs

Costs that change in proportion to the level of production or business activity, such as raw materials and direct labor.