In Comparing Actively Managed Mutual Funds with Those Funds That

question 83

Multiple Choice

In comparing actively managed mutual funds with those funds that simply buy and hold a large market portfolio (index funds) ,we would expect that

• A) the actively managed funds provide a higher return than the index funds.
• B) the index funds provide a higher return after expenses than the actively managed funds.
• C) actively managed funds and index funds provide the same returns.
• D) index funds provide a lower return than actively managed funds only if taxes are taken into consideration.

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Definitions:

Deep Attachments

Strong emotional bonds that form between individuals, often leading to feelings of closeness and security.

Neglected

Failing to care for properly or to give proper attention to.

Autonomy

The ability to make a knowledgeable and voluntary decision on one's own.

Well-Adjusted

Describes an individual who can cope adaptively with the demands of daily life and maintains positive relationships with others.