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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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Answer #1

The correct answer is option C. Both A and B are true.

Unsystematic risk is the risk specific to the firm. Options A and B are examples of unsystematic risk.

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

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

The above two risks are specific to the company and doesn't affect other companies in the industry.

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