Externalities Are Defined as

question 82

Multiple Choice

Externalities are defined as

• A)any transaction external to the firm
• B)costs or benefits that fall on third parties
• C)policies that firms undertake to sell products outside the country
• D)managers' dealings with stockholders outside the firm
• E)costs of maintaining plant and equipment to avoid the scrutiny of external auditors

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Definitions:

12b-1 Fees

These are annual fees charged by a mutual fund to cover marketing, distribution, and sometimes administrative expenses, directly reducing the fund's return to its investors.

Management Expenses

These are fees paid out of fund assets to the fund manager for investment management and operational services, including administrative and overhead costs.

Morningstar

A financial services firm known for its analysis of mutual funds and other investment vehicles, providing investors with ratings and research.

Performance Rating

An evaluation of the investment performance of a security or portfolio compared to a standard or benchmark.