An individual who pays a sales charge every time he or she purchases shares in a mutual fund is investing in a(n) ____ fund.

Question

Quizplus · Accepted Answer

Load funds are mutual funds that charge a sales commission or fee (called a load) every time an investor buys or sells shares in the fund. Therefore, an individual who pays a sales charge every time he or she purchases shares in a mutual fund is investing in a load fund. No-load funds do not charge a sales commission or fee, so they would not be the best choice for this investor. The other options, closed-end, open-end, and income funds, do not necessarily indicate whether or not a sales charge is incurred, so they are not the best answer.

An Individual Who Pays a Sales Charge Every Time He