Which of the Following Statements Is Correct

question 69

Multiple Choice

Which of the following statements is correct?

• A) If a firm's shareholders are well diversified, we know from theory and from studies of market behavior that corporate risk is not important.
• B) Undiversified shareholders, including the owners of small businesses, are more concerned about corporate risk than market risk.
• C) Empirical studies of the determinants of required rates of return (k) have found that only market risk affects share prices.
• D) Market risk is important but does not have a direct effect on share price because it only affects beta.

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Definitions:

Dorsalis Pedis Pulse

is the pulse located on the top of the foot, which can be felt over the dorsalis pedis artery, indicating blood flow to the area.

Femoral Pulse

The palpable beat of the heart that can be felt over the femoral artery, usually in the groin area, used to assess circulation to the lower body.

Popliteal Pulse

The pulse felt at the back of the knee, an indicator of blood flow through the popliteal artery and into the lower leg.

Systolic Auscultation Gap

Refers to a phenomenon where, during blood pressure measurement, sounds disappear for a while between the systolic and diastolic pressures.