Flammox Growth Fund, a mutual fund, issues 200 shares in the market. However, because of a sharp demand from the investors, the fund issues 350 additional shares. In this scenario, the Flammox Growth Fund is structured as a(n) _____:

Question

Quizplus · Accepted Answer

The structure described in the scenario, where a mutual fund issues additional shares in response to demand from investors, is characteristic of an open-end fund. Open-end funds continuously issue new shares and redeem existing shares, based on investor demand. The other options listed (offshore fund, hedge fund, umbrella fund) do not accurately describe the structure of the Flammox Growth Fund as described in the scenario.

Flammox Growth Fund, a Mutual Fund, Issues 200 Shares in the Market