Which Type of Risk Can an Investor Effectively Manage by Investing

question 10

Multiple Choice

Which type of risk can an investor effectively manage by investing in broadly diversified mutual funds?

• A)Serial risk
• B)Systematic risk
• C)Unsystematic risk
• D)None of the above is correct.

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Definitions:

MC

MC, or Marginal Costs, refers to the cost associated with producing an additional unit of a good or service, highlighting the incremental expense of production expansion.

AC

Typically refers to Air Conditioning, a system used for cooling and sometimes heating depending on the air properties needed.

Total Costs

The aggregate amount of all costs associated with the production or offering of goods and services, including fixed and variable costs.

Output

The quantity of goods or services produced in a given time period.