The Business Risk of a Firm

Multiple Choice

The business risk of a firm:

A) depends on the firm's level of unsystematic risk.
B) is inversely related to the required return on the firm's assets.
C) is dependent upon the relative weights of the debt and equity used to finance the firm.
D) has a positive relationship with the firm's cost of equity.
E) has no relationship with the required return on a firm's assets according to M & M Proposition II.