A(n) _____ is a service offered by mutual funds that enables an investor to earn a fully compounded rate of return on their investments.

Question

Quizplus · Accepted Answer

An automatic reinvestment plan (also called a dividend reinvestment plan or DRIP) is a service offered by mutual funds that enables an investor to reinvest their dividends and capital gains distributions to purchase additional shares of the same fund, which can lead to a fully compounded rate of return on their investment. This can be a convenient way to grow your investment over time without having to actively manage it. The other answer choices are all different types of retirement and investment plans, but they do not necessarily relate to earning a fully compounded rate of return on investments.

A(n) _____ Is a Service Offered by Mutual Funds That