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Exam 13: Investing in Mutual Funds

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Question 71

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Closed-end mutual funds can trade at either a discount or a premium from their net asset value.

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Question 72

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There are more closed-end investment companies than there are open-end companies.

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Question 73

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The following mutual fund fees are paid directly from the investor

An open-end investment company is commonly known as a mutual fund.

If you are a mutual fund investor who needs steady income,you might take advantage of a fund's

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -The actual ownership of a mutual fund is in the hands of the [management company | shareholders].

The author recommends small investors should stick to

A fund custodian keeps shareholder records.

The objective of bond and money market funds is growth.

Mutual fund performance is usually evaluated by viewing a given size investment for a certain time period.

Investors tend to use mutual funds for which of the following reasons

Which of the following are characteristic of exchange-traded mutual funds?

Mutual fund conversion privileges can often be exercised using 800 numbers.

Which of the following is not a source of mutual fund returns

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -If you choose to have your mutual fund dividends automatically reinvested,you [may defer taxes on the dividends until you redeem some shares | still owe taxes for the year the dividends were earned].

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -You could drop an automatic investment plan [at any time | only by fulfilling the original agreement].

The price an investor can sell his shares of an open-end mutual fund share is the net asset value.

INSTRUCTIONS: Choose the word or phrase in [ ] which will correctly complete the statement.Select A for the first item,B for the second item,and C if neither item will correctly complete the statement. -A fund that invests only in utility stocks could be classified as [an industry | a sector] fund.

Systematic withdrawal plans offer the investor options as to the liquidation of the fund.

Conversion privileges allow investors to exchange one fund's shares for that of another,as long as the funds are in the same fund family.