Index funds
A)typically have a higher rate of return and higher costs than managed mutual funds.
B)typically have a higher rate of return and lower costs than managed mutual funds.
C)typically have a lower rate of return and higher costs than managed mutual funds.
D)typically have a lower rate of return and lower costs than managed mutual funds.

Question

Quizplus · Accepted Answer

Index funds are passively managed funds that track a specific market index, such as the S&P 500. Because they don't require active management, they have lower operating costs than managed mutual funds. Additionally, research has shown that over the long term, index funds tend to outperform managed mutual funds due to their lower costs and consistent performance tracking the market index. Therefore, option B is the correct answer.

Index Funds