In Theory, the Decision Maker Should View Market Risk as Being

Multiple Choice

In theory, the decision maker should view market risk as being of primary importance. However, within-firm, or corporate, risk is relevant to a firm's

A) Well-diversified stockholders, because it may affect debt capacity and operating income.
B) Management, because it affects job stability.
C) Creditors, because it affects the firm's credit worthiness.
D) All of the answers above are correct.
E) Only answers a and c are correct.