The Part of a Security's Risk Associated with Economic Factors

question 37

Multiple Choice

The part of a security's risk associated with economic factors that affect all firms to some extent is known as the _____. 

• A)diversifiable risk
• B)unsystematic risk
• C)stand-alone risk
• D)market risk
• E)business risk

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Definitions:

Net Cash Flow

The difference between a company's cash inflows and outflows within a specified period.

Investing Activities

Financial transactions related to the acquisition or disposal of long-term assets and investments, considered part of the cash flow statement.

Equipment Purchase

The acquisition of machinery or office equipment, usually classified as a capital expense, to be used in the operations of a business.

Land Purchase

An acquisition of real estate property involving a one-time payment or installment payments, considered a long-term asset on the balance sheet.