Funds That Attempt to Provide Current Income,safety of Principal and Liquidity

question 53

Multiple Choice

Funds that attempt to provide current income,safety of principal and liquidity are known as

• A) Balanced funds.
• B) Flexible funds.
• C) Income funds.
• D) Money market funds.
• E) Index funds.

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Definitions:

Nominal Net Cash Flow

The total amount of cash that flows into and out of a business, not adjusted for inflation.

Inflation Rate

The percentage increase in the general level of prices for goods and services in an economy over a period of time.

NPV

Net Present Value; a financial calculation used to determine the value of a series of future cash flows by discounting them to the present using a specific rate.

Capital Asset Pricing Model

A model that describes the relationship between systematic risk and expected return for assets, particularly stocks.