Which of the Following Statements Are Correct

question 43

Multiple Choice

Which of the following statements are correct?
I.Many professional fund managers are paid well but fail to outperform as expected.
II.Professional fund managers that have tenures in excess of ten years,tend to consistently outperform the market on a long-term basis.
III.If a market is truly efficient,then all investments in that market are zero net present value opportunities.
IV.Actively managing a fund appears to be the key to outperforming the market.

• A)I and III only
• B)II and IV only
• C)II and III only
• D)I, II, and III only
• E)I, II, III, and IV

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Definitions:

Opportunity Cost

The price paid when one opts not to pursue the next most favorable choice during decision-making.

Cash Outlay

The actual amount of money spent or disbursed on goods, services, or assets.

Alternative Investments

Investments in asset classes other than stocks, bonds, and cash, including real estate, hedge funds, private equity, and commodities.

Discontinuing

The process of ending the manufacture, support, or offering of a product or service.