When a Fund Manager Tries to Pick Stocks to Outperform

question 66

Multiple Choice

When a fund manager tries to pick stocks to outperform the market averages, the mutual fund is called a(n) :

• A) active fund.
• B) passive fund.
• C) random walk fund.
• D) loaded fund.

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Definitions:

Accumulated Depreciation

The cumulative amount of depreciation that has been charged to a fixed asset throughout its period of use.

Original Cost

The initial expenditure involved in acquiring an asset, including purchase price, transportation, and installation.

Depreciation

The systematic allocation of the cost of a tangible asset over its useful life, reflecting wear and tear.

Fixed Assets

Long-term tangible assets used in the operation of a business that are not expected to be converted into cash in the upcoming year.