FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 17: Investment Companies

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 21

Multiple Choice

Review LaterAdd Note

Review Later

Money market mutual funds (MMMFs) have caused disintermediation at banks at times. This is because MMMFs

A) sometimes pay higher interest rates than bank deposits.
B) are less risky than bank deposits.
C) are now federally insured,like bank deposits.
D) offer guaranteed rates of return.
E) none of the options

F) B) and C)
G) B) and E)

Correct Answer

verified

Show Answer

Question 22

Essay

Review LaterAdd Note

Review Later

On Monday an equity mutual fund has cash of $150 and stocks worth $900. The fund has 100 shares outstanding. On Tuesday the stocks fall in value to $800 and 10 shares are then redeemed by the fund. Assuming that the fund uses its cash first to cover redemptions,what is the one-day rate of return to the remaining fund shareholders,and how much cash and stock does the fund now have?

Correct Answer

verified

The fund pays the selling shareholders t...

View Answer

Show Answer

Question 23

True/False

Review LaterAdd Note

Because of their ability to hedge,the subprime mortgage crisis did not cause any significant losses to hedge funds.

Open-end mutual funds guarantee

a(n.___________ fund must hold substantial cash reserves in order to meet fund redemptions from shareholders.

Households are the largest owner of money market mutual funds.

The market value of a mutual fund's assets divided by the number of fund shares outstanding is equal to the

By type of fund,there are more ______________ funds than any other.

Funds that specialize in municipal bonds and certain types of real estate to minimize tax liabilities are called hybrid funds.

What are the primary differences between index funds and ETFs? What are two examples of ETFs?

About ___________ of retirement plan investments are in so-called institutional funds,which are funds that manage retirement plans for an institution's employees.

Why are mutual funds popular with individual investors?

Actively managed funds find it difficult to consistently earn higher risk-adjusted returns than a broad stock market index. The difference in return between actively managed funds and passively managed index funds can be explained by which of the following? I. Lower expense ratios at index funds II. Higher turnover ratios at index funds III. Differences in returns in sectors of the market and the overall market return

The Federal Mutual Fund Commission (FMFC)is the primary regulator of the mutual fund industry.

What new rules have resulted from the mutual fund trading abuses?

If you invest $10,000 in a mutual fund with a NAV of $50 per share and a 5.5 percent back-end load,you will receive less than 200 shares in the fund. A back-end load is not paid until fund shares are sold.

Hedge funds may be classified into three types based on their investment strategies and risk level. What are the three types and their broad risk levels? Many different strategies exist in each type. List one example strategy in each type.

A fund that has a fixed number of shares outstanding and is traded on an exchange is called a(n)

An open-end mutual fund owns 1,500 shares of Krispy Kreme priced at $12. The fund also owns 1,000 shares of Ben & Jerry's priced at $43,and 2,000 shares of Pepsi priced at $50. The fund itself has 3,500 of its own shares outstanding. What is the NAV of a fund's share? A. $66 B. $56 C. $46 D. $36 E. $26

How are money market mutual funds similar to and different from bank deposits?