All of the Following Are Advantages of a Mutual Fund

question 76

Multiple Choice

All of the following are advantages of a mutual fund except

• A) Diversification.
• B) Professional management.
• C) Loads of up to 8.5%.
• D) Ease of buying and selling shares.
• E) All of these are advantages.

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Definitions:

Net Income

The amount of profit left over after all expenses, taxes, and costs have been subtracted from total revenue.

Retained Earnings

The part of net earnings a corporation keeps instead of paying out to its shareholders in the form of dividends.

Noncumulative

A term often used to describe preferred stocks or dividends that do not accumulate if they are unpaid or not declared.

Nonparticipating

Describing a type of insurance policy or preferred stock where the holder is not entitled to share in the company's profits beyond a specified amount.