A money market mutual fund is a mutual fund that pools funds from many investors and uses the funds to purchase highly liquid, shortterm securities.

Question

A money market mutual fund is a mutual fund that pools funds from many investors and uses the funds to purchase highly liquid, short­term securities.

Quizplus · Accepted Answer

This statement is true. Money market mutual funds invest in short-term securities such as Treasury bills, commercial paper, and certificates of deposit in order to provide investors with a low-risk option for their cash holdings. The fund manager typically aims to maintain a stable net asset value (NAV) of $1 per share.

A Money Market Mutual Fund Is a Mutual Fund That