Which one of the following is the best example of unsystematic risk?
A)decrease in company sales
B)increase in market interest rates
C)change in corporate tax rates
D)increase in inflation
E)decrease in market interest rates

Question

Quizplus · Accepted Answer

Unsystematic risk refers to risks that are specific to a particular company or industry and cannot be diversified away. A decrease in company sales is an example of unsystematic risk as it is specific to that company and cannot be diversified away by investing in other stocks or assets. The other options are examples of systematic risk as they affect the entire market or economy and cannot be diversified away.

Which One of the Following Is the Best Example of Unsystematic