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Funds 108: Introduction to Mutual Fund Prospectuses

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1.
Which of the following is not covered under a prospectus' section on performance?
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Risks. The "Performance" section deals with objective data.
2.
Transaction fees cover buying and selling costs of securities within a mutual fund.
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True. Transacting is essentially buying and selling portfolio securities.
3.
What does the section on the fund's objectives tell the investor?
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All of the above. The "Objectives" section includes strategies, philosophy, and objectives.
4.
A mutual fund shareholder manual does all of the following except explain how _______.
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Taxes apply. The shareholder manual explains share price, redemption, and adding to your account.
5.
A mutual fund prospectus does all of the following except _______.
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Make recommendations. Prospectuses are forbidden to advertise a fund.
6.
Which party hands out dividends to mutual fund investors?
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The transfer agent. If you chose "distributor," remember that this party distributes shares, not dividends.
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