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Which of the following statements is/are true?   Multiple Choice A. The unplanned increase in the variable...

Which of the following statements is/are true?  

Multiple Choice

  • A. The unplanned increase in the variable costs for a company is an example of an unsystemic risk.

  • B. The unexpected theft of intellectual property of a high-tech company is an example of unsystemic risk.

  • Both A and B are true.

  • Neither A nor B are true.

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Homework Answers

Answer #1

The both statements are true.

Explanation:

Systematic risk is the risk that affects all the companies/firms in the industry.which may be due to the macro factors such as Budget, Change in Governemnt policy etc.

unsystematic risk is the risk that affects the single company in the the industry. In other words it is the risk that which is controlable by the company.

In this question,There are two cases one is for unexpected theft which is purely controlable and affect the single company only and another is for variable cost increase which also affect the single company and purely controable.

So both the statement is an example of Unsystematic risk.

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