Which One of the Following Is an Example of a Nondiversifiable

question 60

Multiple Choice

Which one of the following is an example of a nondiversifiable risk?

• A)A poorly managed firm suddenly goes out of business due to lack of sales
• B)A well managed firm reduces its work force and automates several jobs
• C)A key employee of a firm suddenly resigns and accepts employment with a key competitor
• D)A well respected chairman of the Federal Reserve suddenly resigns
• E)A well respected president of a firm suddenly resigns

---

Definitions:

Self-insight

Self-insight refers to the understanding and awareness individuals have of their own internal states, motivations, desires, and patterns of behavior.

Sociometry

A quantitative method for measuring social relationships, often used to identify social networks or patterns of interaction.

Self-justification

The cognitive process of rationalizing one's behavior, decisions, or beliefs in a manner that avoids admitting fault or error.

Self-view

How an individual perceives or regards themselves, encompassing self-image, self-esteem, and self-concept.