(Consider This) The increased popularity of mutual funds
A)means that far more shares of corporate stock are owned by fund companies than individuals.
B)has greatly reduced diversification.
C)causes corporations to focus more on long-run profitability.
D)has increased overall market risk.

Question

Quizplus · Accepted Answer

The increased popularity of mutual funds means that fund companies are buying more shares of corporate stock, leading to a higher percentage of ownership by fund companies rather than individual investors. This shift in ownership structure can have consequences for corporate governance and shareholder influence.

(Consider This) the Increased Popularity of Mutual Funds