The Portion of an Asset's Risk That Is Attributable to Firm-Specific

question 21

Multiple Choice

The portion of an asset's risk that is attributable to firm-specific, random causes is called

• A) unsystematic risk.
• B) nondiversifiable risk.
• C) systematic risk.
• D) none of the above.

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Definitions:

Operating Activities

Operating activities involve the primary revenue-generating activities of an organization, including production, sales, and delivery of the company’s product as well as administrative and general expenses.

Salaries Expense

The cost incurred by a business to pay its employees for services rendered during a specific period.

Unearned Revenues

Money received by a company for goods or services yet to be delivered or performed, recorded as a liability.

Operating Cash Payments

Cash outflows related to the primary revenue-generating activities of a business, such as payments to suppliers and employees.