Index funds are a portfolio of
A) bonds with rates of return ﬁxed at 2 percentage points above the rate of inﬂation.
B) mutual funds that track different indexes.
C) stocks or bonds that exactly match a particular index.
D) stocks guaranteed rates of return in excess of growth in the GDP price index.

Question

Quizplus · Accepted Answer

Index funds are made up of stocks or bonds that exactly match a particular index, such as the S&P 500 or the NASDAQ. They are designed to provide investors with diversified exposure to the market at a low cost, as compared to actively managed funds.

Index Funds Are a Portfolio of