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Unsystematic Risk Can Be Eliminated Through Diversification

question 110

True/False

Unsystematic risk can be eliminated through diversification.


Definitions:

Book Value

The value of an asset according to its balance sheet account balance, calculated by subtracting accumulated depreciation from the asset's original cost.

Boot

Additional cash or property included in a transaction to even out a trade or exchange of dissimilar assets.

Depreciated

Refers to the reduction in the value of an asset over time due to wear and tear or obsolescence.

Nonmonetary Asset

Assets that cannot be easily converted into cash and hold value in forms other than currency, such as property, equipment, and patents.

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