Question 1

Mutual funds reduce unsystematic risk but not systematic risk.

Accepted Answer

A) True 
 B)False

Question 2

A mutual fund has a fixed capital structure.

Accepted Answer

A) True 
 B)False

Question 3

A mutual fund with a beta coefficient of 0.8

Accepted Answer

A)   invests in an index of the stock market
B)   invests only in debt instruments
C)   has less systematic risk
D)   has less unsystematic riskPROBLEMSFor problems concerning mutual funds, see the problems provided in Chapter 7.

Question 4

The "load" fee charged by a mutual fund is paid when the shares are sold.

Accepted Answer

A) True 
 B)False

Question 5

Mutual funds with beta coefficients greater than 1.0

Accepted Answer

A)   have outperformed the market
B)   have underperformed the market
C)   have more systematic risk than the market
D)   have less systematic risk than the market

Question 6

An exit fee (e.g., 3 percent) has the same impact on an investor's return as an equal load fee (e.g., 3 percent).

Accepted Answer

A) True 
 B)False

Question 7

The per share net asset value of a mutual fund depends on the difference between the fund's assets and liabilities and the number of shares outstanding.

Accepted Answer

A) True 
 B)False

Exam 6: Investment Companies: Mutual Funds Private

Mutual funds with beta coefficients greater than 1.0

Correct Answer
verified

The "load" fee charged by a mutual fund is paid when the shares are sold.

Correct Answer
verified

An exit fee (e.g., 3 percent) has the same impact on an investor's return as an equal load fee (e.g., 3 percent).

Correct Answer
verified

A mutual fund with a beta coefficient of 0.8

Correct Answer
verified

Mutual funds reduce unsystematic risk but not systematic risk.

Correct Answer
verified

The per share net asset value of a mutual fund depends on the difference between the fund's assets and liabilities and the number of shares outstanding.

Correct Answer
verified

A mutual fund has a fixed capital structure.

Correct Answer
verified

Exam 6: Investment Companies: Mutual Funds Private

Mutual funds with beta coefficients greater than 1.0

Correct AnswerverifiedShow Answer

The "load" fee charged by a mutual fund is paid when the shares are sold.

Correct AnswerverifiedShow Answer

An exit fee (e.g., 3 percent) has the same impact on an investor's return as an equal load fee (e.g., 3 percent).

Correct AnswerverifiedShow Answer

A mutual fund with a beta coefficient of 0.8

Correct AnswerverifiedShow Answer

Mutual funds reduce unsystematic risk but not systematic risk.

Correct AnswerverifiedShow Answer

The per share net asset value of a mutual fund depends on the difference between the fund's assets and liabilities and the number of shares outstanding.

Correct AnswerverifiedShow Answer

A mutual fund has a fixed capital structure.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified