Suppose You Consider Investing $1,000 in a Load Fund Which

question 30

Multiple Choice

Suppose you consider investing $1,000 in a load fund which charges a fee of 2%,and you expect the fund to earn 14% over the next year.Alternatively,you could invest in a no-load fund with similar risk that is expected to earn 9% and charges a 1/2 percent redemption fee.Which is better and by how much?

• A) Funds are equal
• B) Load fund by $32.65
• C) Load fund by $50.55
• D) No-load fund by $64.55
• E) No-load fund by $44.30

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Definitions:

Milgram Experiment

A psychological experiment conducted by Stanley Milgram in the 1960s to study obedience to authority, where participants were instructed to administer electric shocks to another person.

Stanford University Prison Experiment

A psychological study conducted by Philip Zimbardo in 1971 at Stanford University, where students were assigned roles of prisoners and guards to explore the effects of perceived power.

Generalization

Drawing a conclusion about a certain characteristic of a population based on a sample from it.

Logical Support

The provision of reasons or evidence to justify a claim or argument.