Use the Information for the Question(s)below

question 35

Multiple Choice

Use the information for the question(s) below.
Big Cure and Little Cure are both pharmaceutical companies.Big Cure presently has a potential "blockbuster" drug before the Food and Drug Administration (FDA) waiting for approval.If approved,Big Cure's blockbuster drug will produce $1 billion in net income for Big Cure.Little Cure has 10 separate less important drugs before the FDA waiting for approval.If approved,each of Little Cure's drugs would produce $100 million in net income for Little Cure.The probability of the FDA approving a drug is 50%.
-Which of the following types of risk doesn't belong?

• A)Market risk
• B)Unique risk
• C)Idiosyncratic risk
• D)Unsystematic risk

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Definitions:

Depreciation Policy

A specific method or approach a company uses to allocate the cost of a tangible asset over its useful life.

Underground Storage

Facilities used for the storage of goods, valuables, or commodities below the earth's surface.

Market Value

The existing value at which a service or asset may be sold or bought within a market environment.

Worksheet

A tool used in accounting to compile all the financial statements and support in preparing closing entries.