All Courses > Funds > 100
Funds 107: Mutual Fund Expenses

Test your knowledge

Choose wisely. There is only one correct answer to each question.

0%
Keep studying!
Review your answers below to learn more.
1.
One reason to choose a low-cost bond fund over a higher-cost bond fund is that bond fund returns don't differ very much anyway, so you may as well save on expenses.
Choose wisely. There is only one correct answer.
True. Bond fund returns don't vary all that much. Many investors find that every dollar going to expenses will hurt their return noticeably.
2.
Redemption fees cover the _______ of mutual fund shares.
Choose wisely. There is only one correct answer.
Selling. Redemption fees are charged when you sell, or redeem, shares back to a fund.
3.
You may be assessed an exchange fee when you put your earned dividends back into your mutual fund.
Choose wisely. There is only one correct answer.
False. You may be charged a sales load on reinvested dividends, but not an exchange fee.
4.
Front-end sales loads apply when you _______ mutual fund shares.
Choose wisely. There is only one correct answer.
Buy. Front-end loads, or sales charges, are charged when you buy mutual fund shares.
5.
Which of the following is not a cost covered by a mutual fund's 12b-1 fees?
Choose wisely. There is only one correct answer.
Management expenses. These are not covered by 12b-1 fees, but by their own fees.