Risk That Affects a Large Number of Assets, Each to a Greater

question 283

Multiple Choice

Risk that affects a large number of assets, each to a greater or lesser degree, is called:

• A) Idiosyncratic risk.
• B) Diversifiable risk.
• C) Systematic risk.
• D) Asset-specific risk.
• E) Total risk.

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Definitions:

Inelastic Demand

A situation where the demand for a product does not significantly change with a change in its price.

Elastic Supply

A situation where the quantity supplied of a good changes significantly as the price changes.

Tax Burden

The total amount of tax that individuals, businesses, or other entities must pay to authorities, often expressed as a percentage of income or revenue.

Inelastic Demand

A situation where the demand for a good or service is not significantly changed by changes in price.