Choose wisely. There is only one correct answer to each question.
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1.
There is a religious objection to investments that pay interest.
True. Islamic investing forbids the paying of interest, and therefore many Islamic mutual funds do not invest in bonds.
2.
A socially responsible investing fund might engage in shareholder activism within companies it owns because _______.
It wants to change policies it disagrees with. A perfectly ethical company is a rarity; thus, a SRI fund might use activism to mold its companies to its wishes.
3.
Shareholder activism is a key for _______.
Some SRI funds. Some SRI funds engage in shareholder activism to reform companies. Others simply shun those companies.
4.
Which statement is false?
It's easy to build a well-diversified, high-quality portfolio made up only of SRI. Building an all-SRI portfolio can be difficult. There just is not an abundance of good choices in some areas of the market, especially bonds and international stocks.
5.
Socially responsible funds _______.
May screen companies on different values; there's no one SRI approach. Although most SRI funds shun tobacco, alcohol, and nuclear-weapons manufacturers, they can screen on dozens of different criteria. There's no single approach.
