Question
Which of the following statement is correct: 1.A
company's earnings being negatively affected by a strike by its workers or a major lawsuit against the company is an example of systematic risk. 2.A company that relies heavily on a single supplier for raw materials is an example of unsystematic risk. 3.A company that has significant debt obligations. If the company experiences financial distress or default, the value of its debt securities may decline, and the company may be forced to declare bankruptcy this is an example of systematic risk. 4.Global economic recession or a financial crisis, which can lead to a general decline in the stock market, reduced consumer spending is an example of systematic risk. 5.When interest rates rise, the cost of borrowing increases, which can lead to decreased consumer spending and reduced economic activity is an example of unsystematic risk.Solution
Unsystematic risk, also known as company-specific risk, is the risk that is inherent in a particular company or industry, and is not related to the overall market or economy. It can be reduced through diversification of investments. A company that relies heavily on a single supplier for raw materials is exposed to unsystematic risk. If that supplier experiences a disruption in its operations, such as a natural disaster or bankruptcy, the company may not be able to obtain the necessary materials to manufacture its products, resulting in a loss of revenue and profitability. This risk is specific to the company and is not related to the overall market or economy. Global economic recession or a financial crisis, which can lead to a general decline in the stock market, reduced consumer spending, and decreased economic activity. These events are beyond the control of individual investors and affect all investments, regardless of their specific characteristics this is an example of systematic risk.
"The manager's decision to implement the new software system was met with widespread __________ from the employees, who were concerned about the changes."
"I don't want to ___________, but I did really well on the test."
An unending sea of ……….. in the desert isn’t as easy to drive through as it looks – this is the territory of ………….. after all, but if...
(a) All the family members ____________ minor injuries in the accident.
(b) A cup of coffee will not be helpful enough to __________ you until lu...
Many critics regard the argument as ___________ or, at best, misleading.
Fill in the blanks with appropriate forms of modals from the alternatives given below each sentence.
I _____ learn English, and none shall sto...
Mr. Obama’s________ will have long-term ________ for U.S.-Russia ties. The rising tensions have ________ fears of a new Cold War.
It’s easy to be ………… , but difficult to ………………
Given below sentence with one blank. Below sentence are given four words among which one word might fill the blank. If none of the words fill the blank...
Choose the most appropriate word to fill in the blank:
The government has _______ new regulations to improve envir...
Relevant for Exams:
