Which of the Following Provides the Best Example of a Systematic

question 30

Multiple Choice

Which of the following provides the best example of a systematic risk event?

• A)A strike by union workers hurts a firm's quarterly earnings.
• B)Cattle disease in Queensland hurts local farmers and buyers of beef.
• C)The Reserve Bank increases interest rates 50 basis points.
• D)A senior executive at a firm embezzles $10 million and escapes to South America.

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Definitions:

Gross Margin

Gross margin is the difference between revenue and the cost of goods sold divided by revenue, expressed as a percentage, indicating the efficiency of turning sales into profit.

Net Operating Income

The total profit of a company after operating expenses are subtracted from total revenue but before taxes and interest are deducted.

Common Fixed Expenses

Fixed costs that are not directly tied to the level of goods or services produced by the business, such as rent, utilities, and salaries of administrative staff.

Sales Territories

The division of a market or customer base into specific areas, each managed by a sales representative or team, to optimize sales and marketing efforts.