In Theory, the Decision Maker Should View Market Risk as Being

question 37

Multiple Choice

In theory, the decision maker should view market risk as being of primary importance.However, within-firm, or corporate, risk is relevant to a firm's

• A) Well-diversified shareholders, because it may affect debt capacity and operating income.
• B) Management, because it affects job stability.
• C) Creditors, because it affects the firm's credit worthiness.
• D) All of the above are correct.
• E) Only answers a and c are correct.

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Definitions:

Negative Organizational News

Information about setbacks, failures, or unfavorable conditions within an organization that can impact its stakeholders' perceptions and morale.

Unique Needs

The specific and individual requirements or preferences of a person or group that differ from the general population or norm.

Positive Words

Language that conveys optimism, encouragement, or constructive feelings.

Bad News

Information that is undesirable, disappointing, or negative in nature.