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In the world of mutual funds, what are outstanding shares?

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Shares of very high quality

Shares waiting to be bought

Shares owned by the public

Shares that are not part of a mutual fund

Shares owned by the public. To be "outstanding" is to be in the public's possession.

Diversification spreads risk among several different investments.

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True

False

True. Each investment has its own risk profile.

When a mutual funds individual holdings make money, so do the mutual funds shareholders.

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True

False

True. Earnings are passed from the holdings to the funds shareholders.

If you buy mutual fund shares from another investor instead of from the fund itself, you are buying _______ shares.

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Open-end

Closed-end

None of the above

Closed-end. Closed-end fund shares are traded between investors and cannot be bought from the fund itself, except when it sells shares for the very first time.

The mutual fund advisor may play additional roles besides that of advisor.

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True

False

True. It may also be the transfer agent.

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