Mutual Fund Representatives Try to Maximize the Returns on Their

question 116

True/False

Mutual fund representatives try to maximize the returns on their clients' portfolios, so they can earn more commission.However, they may also be on a lookout for making trades, which will earn them the most commission even if it might not be best solution for their clients.This is an example of a conflict of interest.

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Definitions:

Acquired Firm

A company that has been purchased and taken over by another company.

Substitutes

are products or services that can replace or be used in place of another, catering to similar needs or functionalities, often influencing consumer choices and market dynamics.

Substitute Good

A product or service that can be used in place of another to satisfy similar needs or demands.

Market Power

The ability of a company or group of companies to control prices and total market output in an industry or sector.