It is claimed that mutual funds have two advantages. The first is that mutual funds allow people with small amounts of money to diversify. The second is that mutual funds provide the skills of professional money managers who buy stocks they believe will be the most profitable and thereby increase the return that mutual fund depositors earn on their savings
a. Economists strongly agree with both claims.
b. Economists are skeptical of both claims.
c. Economists are skeptical of the first claim, but strongly agree with the second.
d. Economists strongly agree with the first claim, but are skeptical of the second.
d
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Refer to Table 2-12. Does either Guatemala or Honduras have an absolute advantage and if so, in what product?
A) Honduras only has an absolute advantage in producing sailboats. B) Guatemala has an absolute advantage in producing both products. C) Guatemala only has an absolute advantage in producing canoes. D) Honduras only has an absolute advantage in producing canoes.
A manager of a clothing firm is deciding whether to add another factory in addition to one already in production. The manager would compare
a. The total benefits gained from the two factories to the total costs of running the two factories. b. The incremental benefit expected from the second factory to the total costs of running the two factories. c. The incremental benefit expected from the second factory to the cost of the second factory d. The total benefits gained from the two factories to the incremental costs of running the two factories.
To identify whether fiscal policy is expansionary or contractionary, one should focus on the cyclical deficit
Indicate whether the statement is true or false
In a progressive tax system
A. the marginal tax rate and the average tax rate decrease as income levels increase and the marginal tax rate is less than the average tax rate. B. the marginal tax rate and the average tax rate increase as income levels increase and the marginal tax rate exceeds the average tax rate. C. the marginal tax rate increase as income increases but the average tax rate does not change as income increases. D. the marginal tax rate and the average tax rate are the same for every income level and the same as income increases.