"Balanced" Mutual Funds

question 16

Multiple Choice

"Balanced" mutual funds:

• A) offer mixtures of stocks and bonds.
• B) spread their investments equally over a specified geographic area.
• C) spread their investments equally over various industries.
• D) charge a management fee that is proportionate to the investment return.

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Definitions:

Competing Producers

Entities or companies that are in the same market striving to gain market share by offering better products, price, or services.

Perfect Competition

A market structure characterized by a large number of small firms, identical products, and freedom of entry and exit, leading to price takers.

Barriers To Entry

Economic, procedural, or regulatory obstacles that prevent or deter new competitors from easily entering an industry or area of business.

Absolute Market Power

The ability of a single economic actor, or a group of actors, to control market prices, output, and/or the market entry of new competitors without external interference.