Use the Information for the Question(s)below

question 56

Multiple Choice

Use the information for the question(s) below.
Consider an economy with two types of firms, S and U. The S firms always move together, but U firms move independently of each other. For both types of firms there is a 70% probability that the firm will have a 20% return and a 30% probability that the firm will have a -30% return.
-If the Reserve Bank was to change from an expansionary to contractionary monetary policy, this would be an example of:

• A)unsystematic risk.
• B)diversification risk.
• C)systematic risk.
• D)independent risk.

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Definitions:

Empathy

The ability to understand and share the feelings of another, enabling a deeper connection and emotional understanding between individuals.

Amoral

Pertains to actions or attitudes that are indifferent to questions of right or wrong, neither moral nor immoral.

Archie Carroll

A scholar known for his work on corporate social responsibility (CSR) and the pyramid model that defines the responsibilities of businesses.

Enduring Change

Long-lasting or permanent transformation within an organization or individual, which can be a result of deliberate actions or external factors.