Who Accepts All of the Risk Associated with a Mutual

question 23

Multiple Choice

Who accepts all of the risk associated with a mutual fund's portfolio of stocks and/or bonds?

• A)the fund's managers
• B)the fund's shareholders
• C)the federal government
• D)the corporations that originally issued the stocks and/or bonds held by the fund

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Definitions:

Gift

Something voluntarily transferred by one person to another without compensation or consideration.

Consideration

The bargained-for exchange; what each party gets in exchange for his or her promise under a contract.

Causa Mortis Gift

A gift given by someone who believes they are about to die, intended to take effect only upon the death of the giver.

Inter Vivos

Describes actions or transactions that take place during the lifetime of an individual, often used in the context of gifts or trusts created while the donor is alive.