Which of the Following Statements Is False

question 73

Multiple Choice

Which of the following statements is false?

• A) Firm-specific news is good or bad news about the company itself.
• B) Firms are affected by both systematic and firm-specific risk.
• C) When firms carry both types of risk, only the firm-specific risk will be diversified when we combine many firms' stocks into a portfolio.
• D) The risk premium for a stock is affected by its idiosyncratic risk.

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Definitions:

Market Share

The portion of a market controlled by a particular company or product.

Management Jobs

Positions within an organization responsible for strategizing, decision-making, and overseeing teams or departments to achieve company objectives.

Financial Institution

An establishment that conducts financial transactions such as investments, loans, and deposits.

Provincial Governments

The governing authorities of regions or provinces within a country, responsible for administering regional laws and policies.