Multiple Choice
Systematic risk
1) is the tendency for a stock's return and the return on the market to move together
2) is reduced by constructing a diversified portfolio
3) depends on the firm's business and financial risk
4) is measured by beta coefficients
A) 1 and 2
B) 2 and 3
C) 1 and 4
D) 2 and 4
Correct Answer:
Verified
Correct Answer:
Verified
Q10: Sources of risk include<br>1) fluctuations in stock
Q11: The standard deviation measures an asset's expected
Q12: The larger an investment's standard deviation, the
Q13: For a security to help diversify a
Q14: The capital asset pricing model specifies the
Q16: Components of the capital asset pricing model
Q17: Unsystematic risk is the tendency for stock
Q18: A diversified portfolio reduces<br>A) unsystematic risk<br>B) systematic
Q19: You bought a stock with a beta
Q20: An investor may reduce risk by<br>1) selecting