It Is Claimed That Mutual Funds Have Two Advantages

question 151

Multiple Choice

It is claimed that mutual funds have two advantages.The first is that mutual funds allow people with small amounts of money to diversify.The second is that mutual funds provide the skills of professional money managers who buy stocks they believe will be the most profitable and thereby increase the return that mutual fund depositors earn on their savings.

• A)Economists strongly agree with both claims.
• B)Economists are skeptical of both claims.
• C)Economists are skeptical of the first claim,but strongly agree with the second.
• D)Economists strongly agree with the first claim,but are skeptical of the second.

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Definitions:

Voting Rights

Entitlements granted to shareholders or citizens to vote in corporate or public elections, respectively.

Unissued Shares

Unissued Shares are portions of a company's authorized capital stock that have been authorized for issuance but have not yet been issued to shareholders.

Treasury Stock

Shares that were once part of the open market stock but were bought back by the issuing company, reducing the amount of outstanding stock.

Quorum

The minimum number of members required to be present at a meeting to make the proceedings of that meeting valid.