It Is Claimed That a Secondary Advantage of Mutual Funds

question 63

Multiple Choice

It is claimed that a secondary advantage of mutual funds is that

• A)an investor can avoid investment charges and fees.
• B)they give ordinary people access to loanable funds for investing.
• C)they usually outperform stock market indexes.
• D)they give ordinary people access to the skills of professional money managers.

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Definitions:

Variable Cost

Costs that vary in proportion to the level of activity or volume of production in a business.

Annual Fixed Costs

Expenses that a business incurs that do not fluctuate with changes in production level or sales volume, such as rent or salaries, benchmarked on a yearly basis.

Graphical Approach

A method of solving problems or representing data using charts, graphs, or diagrams.

CVP Analysis

Short for Cost-Volume-Profit Analysis, a tool used to determine how changes in cost and volume affect a company's operating income and net income.