Which of the Following Statements About Mutual Funds Is False

question 43

Multiple Choice

Which of the following statements about mutual funds is false?

• A)Mutual funds provide diversification at a minimum cost.
• B)Mutual funds have experienced tremendous growth in recent years.
• C)Mutual funds offer greater safety and less diversification than investment in one or more stocks.
• D)Mutual funds pool the funds of many investors and then invest in several hundred or even thousands of stocks.

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Definitions:

Proportion

A statistic that indicates the fraction of the dataset that is part of a specific category or that possesses a certain attribute.

Simple Random Sample

A sampling method where each member of a population has an equal chance of being selected.

Tablet Computer

A portable computing device featuring a touchscreen interface and is larger than a smartphone but smaller than a laptop.

Odds

A ratio representing the probability that a particular event will take place compared to the probability that it will not.