Unique Risk - Non-Systematic Risk Quiz
12 Questions
0 Views

Choose a study mode

Play Quiz
Study Flashcards
Spaced Repetition
Chat to lesson

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What type of risk affects the entire market or a broad segment of it?

  • Inflation risk
  • Interest rate risk
  • Unique risk
  • Market risk (correct)
  • How does high inflation impact companies?

  • Increases profit margins
  • Boosts consumer spending
  • Decreases stock prices (correct)
  • Lowers borrowing costs
  • Which factor can slow down economic growth due to higher borrowing costs?

  • Stable profit margins
  • Low inflation
  • High-interest rates (correct)
  • Increased consumer spending
  • What is the primary reason why diversification can help mitigate unique risk?

    <p>Spreads investments across different assets</p> Signup and view all the answers

    Which type of risk is related to factors beyond individual companies' control?

    <p>Market risk</p> Signup and view all the answers

    How does high-interest rates impact consumer spending?

    <p>Lowers consumer spending</p> Signup and view all the answers

    Which type of risk affects individual companies or assets and cannot be easily diversified away?

    <p>Unique risk</p> Signup and view all the answers

    How could lawsuits against a pharmaceutical company affect its stock price?

    <p>Cause the stock price to drop due to legal costs</p> Signup and view all the answers

    What effect can a strike by workers at an automobile manufacturer have on the company's profitability?

    <p>Decrease profitability by disrupting production</p> Signup and view all the answers

    How could winning a major government contract impact a technology company's stock price?

    <p>Boost revenue and stock price</p> Signup and view all the answers

    What is one way in which a successful advertising campaign by a retail company can affect its stock price?

    <p>Drive up sales and increase investor confidence</p> Signup and view all the answers

    Why is Unique risk also referred to as Non-Systematic Risk?

    <p>Because it affects individual companies and assets</p> Signup and view all the answers

    More Like This

    Unique Properties of Water
    13 questions

    Unique Properties of Water

    SnappyPiccoloTrumpet avatar
    SnappyPiccoloTrumpet
    Unique Drink Combos Quiz
    30 questions
    Use Quizgecko on...
    Browser
    Browser