Compare and contrast open-end and closed-end mutual funds
What will be an ideal response?
Answer: Open-end funds can literally issue as many shares as investors want. The fund grows and shrinks as shares are bought by investors and sold by the same. The value of all the investments determines how much each share in the fund is worth. On the other hand, a closed-end fund only sells shares once. After that, investors must conduct trading among themselves. This fund determines the value of each share by the value of the investments that the fund holds and investors' demand for the shares in the fund.
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Capital market instruments include
A) negotiable certificates of deposit. B) Treasury bills. C) corporate equities. D) commercial paper.
Little, Inc. paid a 20 percent stock dividend. Prior to the dividend, the stock's price was $50 a share. Immediately after the dividend, the price will
A) increase to $60.00 a share. B) decrease to $40.00 a share. C) decrease to $41.67 a share. D) do nothing in particular because of the dividend.