Mutual Fund Trading Costs

question 78

Multiple Choice

Mutual fund trading costs:

• A)are computed as a percentage of a fund's assets.
• B)are generally set at a flat amount per year.
• C)generally include a bonus fee for outperforming an index.
• D)increase in direct relation to the turnover rate.
• E)are the costs paid to brokers in the form of sales commissions.

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Definitions:

Slope

A measure of the steepness or inclination of a line or surface, calculated as the ratio of the vertical change to the horizontal change between two points.

Tacos

A traditional Mexican dish consisting of a folded or rolled tortilla filled with various mixtures, such as seasoned meats, beans, cheese, and vegetables.

Budget Line

A graphical representation of all possible combinations of two goods that can be purchased at given prices and within a consumer's budget.

Horizontal Axis

In a graph or chart, the x-axis, which usually represents the independent variable or time scale.