Funds Intermediate: Growth Mutual Funds

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1.
The stocks that growth mutual funds invest in may not pay dividends.
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True. A corporation may reinvest its surplus earnings back into its stocks to expand the company rather than pay dividends.
2.
Large-cap companies are popular choices for growth mutual funds.
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False. Although they may be included, they are not as frequently chosen as small-caps and mid-caps are. These latter companies generally have more room to grow than large-caps do.
3.
Growth mutual funds rarely make the list of top ten funds from one year to the next because _______.
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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.
4.
Growth mutual funds pay few or no dividends because the companies they invest in usually reinvest their profits for more growth.
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True. Reinvesting profits adds to a companys capitalization.
5.
The Acme Internet Enterprise Fund, which is an up-and-coming Internet mutual fund, is likely to be a sector fund.
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True. According to its name, it invests in one area of the marketthe Internet.