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1.
A 1.5% expense ratio is acceptable for which type of fund?
A foreign-stock fund. You should expect to pay less for fund types with a narrow range of returns, such as bond or large-cap stock funds. Look for funds with expense ratios of 1% or less. The range of returns is wider for small-cap or foreign funds, so you should expect to pay more.
2.
What is the name of the expense that compensates those who administer a mutual fund?
Management fee. This fee pays for those who run funds.
3.
Which of the following is not another name for a redemption fee?
Front-end load. Front-end loads are charged when you buy shares, not when you redeem them.
4.
If a mutual fund does not charge a sales load, it may compensate its brokers through 12b-1 fees.
True. Some people call 12b-1 fees hidden loads because they compensate brokers in this way.
5.
Which class of mutual fund shares includes charges in addition to sales loads?
Class C. In addition to a small front-end load, class C shares include other fees (such as marketing costs).