High Fees

question 95

Multiple Choice

High fees:

• A) are not likely to generate higher returns in the long run because of the efficient markets hypothesis.
• B) are not likely to generate higher returns in the long run because of diversification issues.
• C) can often signal a higher-quality management and thus higher returns in the long run.
• D) have little impact on your long-run returns to investing.

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Definitions:

Individual Rights Principle

An ethical guideline that stresses the importance of respecting and protecting the rights of individuals in decision-making processes.

Persistence

The quality of continuing firmly or obstinately in a course of action in spite of difficulty or opposition.

Direction

Guidance or supervision provided to achieve a goal or follow a particular course of action; often implies leadership or the process of setting goals.

Intensity

The degree of strength, force, or energy with which an action is executed or a characteristic is manifested.