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1.
In what do money market funds invest?
Short-term debts. The money market is composed of short-term debts and nothing else.
2.
Which of the following is not a method of buying mutual fund shares?
All of the above are valid methods. All the methods named are valid ways to buy mutual fund shares.
3.
_______ are the earnings on a mutual fund's holdings that are distributed to shareholders.
Dividends. Dividends are shareholders' shares of earnings.
4.
What do hybrid mutual funds strive to achieve?
A particular investment objective. Hybrid funds are defined by their objectives, and their names often reflect this. The other choices are only examples of hybrid funds.
5.
If a fee is charged on mutual fund shares that are sold, it is called a(n) _______.
Back-end load. These fees are charged on shares that you redeem back to the fund.
6.
A mutual fund is a(n) _______.
Package of several types of securities. Although some mutual funds invest only in stocks or bonds, mutual funds as a whole are open to several types of securities.
7.
What are bonds sold by states called?
Municipal bonds. This is the accepted name for them. The term "government bonds" refers to bonds sold by the federal government.
8.
Common stocks are chosen by stock mutual funds because they have potential for growth.
True. Of the two types of stock, common and preferred, common stocks provide the opportunity for growth.