Primary Liability Is Unconditional

question 52

True/False

Primary liability is unconditional.

---

Definitions:

Total Risk

The sum of all risks affecting an investment, including both systematic (market) and unsystematic (individual) risks.

Systematic Risk

The danger associated with the overall market or a specific sector of the market that cannot be mitigated by spreading investments.

Capital Asset Pricing Model

A model used to determine the theoretical rate of return of an asset, considering the asset’s risk relative to that of the market.

Beta

A measure used in finance to describe the relationship of an investment's returns with those of the market; it indicates the investment's risk compared to the market.