Which of the Following Is True of Equity Funds

question 403

Multiple Choice

Which of the following is true of equity funds?

• A) Managed equity funds generally outperform indexed equity mutual funds.
• B) Managed equity funds merely hold stocks in the same proportion they are represented in a broad stock market index such as the Standard & Poor's 500.
• C) Indexed equity funds generally have lower management and operating costs than managed funds.
• D) Indexed equity funds generally engage in more stock trading than managed funds.

Apply the concept of the time value of money in analyzing financial decisions.

Calculate the present value of growing annuities.

Assess financial decisions involving annuities with various compounding interest rates.

Evaluate investment opportunities by calculating their present value.

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