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Certified Trust and Financial Advisor (CTFA) Questions 166–170 (page: 35)

Updated On: 9-Feb-2026

The number of mutual funds is:

  1. Under 10 thousand
  2. Under 5 thousand
  3. Over 100 thousand
  4. Over 15 thousand

Answer(s): D



Bond funds offer:

  1. Zero volatility
  2. Relatively stable income
  3. Superior capital appreciation
  4. No-risk investment

Answer(s): B



Mutual funds make you money through:

  1. Currency appreciation
  2. Tax deductions
  3. income and capital appreciation
  4. Yield

Answer(s): C



Espinosa Coffee & Trading, Inc.'s common stock measured beta is calculated to be 0.75. The market beta is, of course, 1.00 and the beta of the industry of which the company is a part is 1.10. If Merrill Lych were to calculate an "adjusted beta" for Espinosa's common stock, that adjusted beta would most likely be .

  1. less than 0.75
  2. more than 0.75, but less than 1.10
  3. equal to 1.10
  4. equal to 0.95 {i.e., (1/3) x (0.75 + 1.00 + 1.10)}

Answer(s): B



The 12b-1 fee covers:

  1. Fund's distribution and advertising cost
  2. Investor education
  3. Fund manager's travel expenses
  4. Brokerage expenses

Answer(s): A



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