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    Question

    ABC Ltd stated the reason of poor performance of the

    company was the unsystematic risks faced by it in the current financial year. Which of the following is the likely to be the unsystematic risk that ABC Ltd would have faced?
    A Inflation Correct Answer Incorrect Answer
    B Interest rate fluctuation Correct Answer Incorrect Answer
    C Depreciation of currency Correct Answer Incorrect Answer
    D Shortage of raw material with supplier company Correct Answer Incorrect Answer
    E All of the above Correct Answer Incorrect Answer

    Solution

    Unsystematic risk is the risk associated with the specific industry or company. Here shortage of raw material with supplier company is specific to ABC Ltd. Rest of the risks are systematic in nature, i.e. they impact whole market and all participants like inflation, or changes in interest rate.

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