Which One of the Following Statements Is Correct

question 25

Multiple Choice

Which one of the following statements is correct?

• A)Professional money managers outperformed the Vanguard 500 Index Fund on an annual basis more than half the time for the period 1977-2011.
• B)Purchasing and holding a broad-based index fund is a highly recommended means of investing.
• C)The number of general equity mutual funds has decreased over the past 20 years due to their underperformance as compared to index funds.
• D)The survivorship bias lowers the returns earned by professional money managers as a group.
• E)In an efficient market, there is no need for professional money managers.

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Definitions:

Cultural Expectations

The societal norms or standards that dictate how individuals should behave within their culture.

Socialization

The lifelong process by which individuals learn and internalize the values, beliefs, norms, and social skills necessary to participate within their society.

Family

A primary group of people—usually related by ancestry, marriage, or adoption—who form a cooperative economic unit to care for any offspring (and each other) and who are committed to maintaining the group over time.

Social Expectations

The norms and standards established by society that influence and regulate individuals' behavior, roles, and interactions.