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1.
Growth mutual funds rarely make the list of top ten funds from one year to the next because _______.
They are very volatile. They may not perform as well as "top ten" funds every year, but over the course of many years, they show steady growth.
2.
The Acme Internet Enterprise Fund, which is an up-and-coming Internet mutual fund, is likely to be a sector fund.
True. According to its name, it invests in one area of the marketthe Internet.
3.
How do the managers of growth mutual funds enable their funds to grow in value?
They invest in the stocks of companies they believe will outperform the market average. They believe there is a demand for these stocks, which will increase in price.
4.
Growth funds seek to grow for the short term.
False. Even though they try to earn large profits quickly, growth funds seek to grow over long periods.
5.
The stocks that growth mutual funds invest in may not pay dividends.
True. A corporation may reinvest its surplus earnings back into its stocks to expand the company rather than pay dividends.