True, False or uncertain, with reason

1. Warren Buffett believes that derivatives are financial weapons of mass destruction because the expected return to buying out-of-the-money put options ismore negative than implied by the capital asset pricing model.

2. Target date mutual funds are popular products for retail investors 401-k portfolios because they automatically follow rebalancing strategies which allow investors to benefit from asset pricing anomalies such as momentum.

3. Since retail investors like the glamour of growth stocks, they should avoid target date retirement funds, which underweight such stocks.

4. When large investment banks deleverd their portfolios during the financial crisis, interest rates rose dramatically as a result of fire sale selling of junk bonds, investment grade corporate bonds, securities backed by subprime mortgages, and U.S. government securities.

5. A financial economist would say that a pension plan is well-funded if its existing assets would cover its existing liabilities with high probability, under the assumption that the equity premium in the future is the same as the equity premium in the past.

6. A financial economist would say that a pension plan is well-funded if its existing assets would cover its existing liabilities with high probability, under the assumption that the equity premium in the future is the same as the equity premium in the past.

7. Republicans favor better funding of state and local pension plans because they want to insure that that underpaid government employees receive the pension benefits they are promised.

8. Mutual fund fees tend to have a convex payoff structure because withdrawals by fund investors tend to accelerate with bad performance