The Following Data Was Collected on Mutual Fund Prices

question 44

Multiple Choice

The following data was collected on mutual fund prices. Compute the Paasche price index to compare mutual fund prices in 2015 to 2010.

• A) 245.86
• B) 154.51
• C) 153.04
• D) 147.22

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Definitions:

Arbitrage

The practice of buying and selling assets in different markets or forms to profit from differing prices for the same asset.

Predatory Pricing

A strategy where a firm sets prices below cost with the intention of driving competitors out of the market, and then possibly raising prices to higher levels once competition is reduced.

Mark-up Pricing

A pricing strategy where a fixed percentage is added to the cost of producing a good or service to determine its selling price.

Direct Discrimination

Actions or policies that explicitly treat an individual or group less favorably than others based on prohibited grounds such as race, gender, or age.