A Problem with Taxation of Mutual Funds Is

question 17

Multiple Choice

A problem with taxation of mutual funds is

• A) Professional management.
• B) The possibility to eliminate taxes if held in a Roth individual retirement account.
• C) Being required to report reinvested income dividends and capital gain distributions on your federal tax return as current income.
• D) Tax deferral if the fund is held in a retirement account like a 401(k) account.
• E) The diversification offered to investors.

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Definitions:

Jean Piaget

A Swiss psychologist known for his pioneering work in child development, particularly his theory of cognitive development stages.

Successive Changes

A process involving a series of modifications, adjustments, or developments that follow one after the other in a particular order or sequence.

Continuous Development

Continuous development refers to a progression where improvements or growth occur gradually and steadily over time without sudden leaps or stages.

Gratification

The satisfaction or pleasure felt when a need or desire is fulfilled.