How is known the process in which an investment company continually offers new shares and buys existing shares back on demand and uses its capital to invest in diversified securities of other companies ?
Correct answer: B. Mutual fund
- A. combine fund
- B. Mutual fund
- C. Liquid fund
- D. Stock holding company
Explanation
A mutual fund pools investors’ money, issues or redeems units, and invests the capital in a diversified portfolio of securities. This diversification distinguishes it from a single-company stock-holding arrangement.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Microeconomics
Individual consumers, firms and markets are examined through demand and supply, elasticity, consumer choice, production, costs, revenue and the determination of prices and output. The topic also covers market structures such as perfect competition, monopoly and oligopoly, plus market failure, externalities and the distinction between microeconomic decisions and economy-wide outcomes.
Practise Microeconomics
1,742 free Microeconomics MCQs from Economics, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Economics questions like this
Economics is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Microeconomics questions
Which term is used for an engagement in risky business with the idea of making a large profit in short time ?
What is underwriter ?
What is referred by the Working capital ?
Monoculture is ?
What is called the market in which forces of demand and supply are not in the control of government ?
The term liquidate refers to pay off a debt, a claim or an obligation or to settle the affairs by determining liabilities and applying assets to their discharge. What is also converted by the term?