Which of the Following Statements Is FALSE

question 75

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:

Informational Social Influence

The change in opinions or behavior that occurs when individuals conform to the attitudes or actions of others, based on the desire for accuracy.

Cough

A sudden, forceful expulsion of air from the lungs typically as a reflex to clear the throat or airways.

Natural Mimicry

The act of imitating or copying the appearance, behaviors, or sounds of other species or natural phenomena, often as a survival technique.

Facial Expressions

Movements of the facial muscles that convey emotions, intentions, or reactions without verbal communication.