Which of the Following Risks Is Most Important to a Well-Diversified

question 65

Multiple Choice

Which of the following risks is most important to a well-diversified investor in common stocks?

• A)Market risk
• B)Unique risk
• C)Total risk
• D)Diversifiable risk

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Definitions:

Supply Function

A mathematical relation showing the amount of goods a supplier is willing and able to provide to the market at various prices, holding all other factors constant.

Demand Function

A demand function quantifies the relationship between the price of a good and the quantity demanded by consumers, holding other factors constant.

Supply Curve

A supply curve graphically represents the relationship between the price of a good and the quantity of the good that producers are willing and able to supply, typically sloping upwards.

Demand Curve

A graph showing the relationship between the price of a good and the quantity demanded by consumers, typically sloping downward from left to right.