A Possible Reason for the High Systematic Risk of VAREX

question 2

Multiple Choice

A possible reason for the high systematic risk of VAREX in LCDs and EMs is

• A)the tendency of world commodity prices to reflect non-similar economic conditions.
• B)the sensitivity of this ratio to rising nominal and real interest rates in the developed, or lending, countries.
• C)the tendency of prices and world demands for commodities to reflect simultaneously economic conditions.
• D)the discretionary nature of money supply growth for LDC governments.
• E)different demands for imports, and wide differences in the scale of vital imports across LDCs.

---

Definitions:

Adjusted Trial Balance

A financial statement that displays all balances of accounts after adjustments have been made, used to prepare final financial statements.

Unadjusted Trial Balance

A list of all the general ledger accounts and their balances at a specific point in time before any adjustments are made for the accounting period.

Columnar Working Paper

An accounting paper used for preparing financial statements or other reports, organized with columns to facilitate data entry and comparison.

Adjusted Trial Balance

A statement listing all accounts and their final balances after adjustments, used to verify the balance of debits and credits.