Which of the Following Statements Is True

question 50

Multiple Choice

Which of the following statements is true?

• A)Systematic risk is also referred to as idiosyncratic risk, while unsystematic risk is also referred to as implicit risk.
• B)Unsystematic risk is also referred to as implicit risk, while systematic risk is also referred to as idiosyncratic risk.
• C)Systematic risk can be reduced by diversification, while unsystematic risk cannot be reduced by diversification.
• D)Unsystematic risk can be reduced by diversification, while systematic risk cannot be reduced by diversification.

---

Definitions:

Population Standard Deviation

A measure of the dispersion of a set of data from its mean, considering the entire population.

Confidence Level

The probability that the value of a parameter falls within a specified range of values, often used in confidence intervals.

Sample Size

The total count of data points or observations gathered from a population to perform statistics.

Error of Estimation

Error of estimation is the discrepancy between an estimated value and the true value of a parameter being estimated.