You Are Considering the Purchase of a Mutual Fund

question 53

Multiple Choice

You are considering the purchase of a mutual fund. You have found three funds that meet your basic criteria. Each fund has a different alpha. Which alpha indicates the preferred investment?

• A)the most negative alpha
• B)the least negative alpha
• C)the zero alpha
• D)the lowest positive alpha
• E)the highest positive alpha

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Definitions:

Output

The quantity of goods or services produced by a firm, industry, or economy within a specified period.

Total Costs

The sum of all expenses a firm incurs in producing a product or offering a service, including both fixed and variable costs.

Total Variable Costs

The sum of all costs that vary with output level, including materials, labor, and other expenses that change with production volume.

Techniques of Production

The methods and processes used by firms to produce goods and services efficiently.