Which One of the Following Is an Example of Systematic

question 95

Multiple Choice

Which one of the following is an example of systematic risk?

• A)investors panic causing security prices around the globe to fall precipitously
• B)a flood washes away a firm's warehouse
• C)a city imposes an additional one percent sales tax on all products
• D)a toymaker has to recall its top-selling toy
• E)corn prices increase due to increased demand for alternative fuels

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Definitions:

Cost Behavior Analysis

The study of how specific costs respond to changes in the level of business activity.

Activity Base

A measure used in costing that is a significant and quantifiable activity or event, determining the cost incurred by an activity.

Level Of Activity

A measure of the volume of production or work that a business operates at, which can affect costs and efficiency.

Variable Costs

Expenses that vary directly with the amount of production or the degree of business operations.