What Is One Advantage of Most Mutual Funds

question 38

Multiple Choice

What is one advantage of most mutual funds?

• A) They provide a stated rate of return.
• B) They offer tax-free earnings.
• C) They are insured against loss by the federal government, so they can never decline in value.
• D) They offer professional management of investments.

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Definitions:

Consolidation

The process of combining assets, liabilities, and other financial items of two or more entities into one. In financial accounting, it refers to the aggregation of financial statements of a group company as consolidated accounts.

Combining Firms

The process of merging two or more companies into one entity, typically to achieve synergies or strategic objectives.

Acquiring Firm

A company that purchases a majority interest in another company to take control of it.

Parent

A company that holds a controlling interest in one or more subsidiaries, or an individual who has a child.