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:

Implicit Costs

The opportunity costs of using resources owned by the firm for its own production instead of earning revenue from these resources elsewhere.

Explicit Costs

These are the direct, out-of-pocket payments made by businesses for operational expenses like wages, rent, and materials.

Monetary Outlay

The amount of money spent on a particular transaction or investment.

Implicit Costs

The opportunity costs that arise when a company uses internal resources without a direct payment.