Relevant portion of an asset's risk attributable to market factors that affect all firms is called ________.
A) credit risk
B) diversifiable risk
C) systematic risk
D) maturity risk

Question

Quizplus · Accepted Answer

Systematic risk, also known as market risk, is the portion of an asset's risk that is attributable to factors affecting an entire market or economy. This type of risk cannot be diversified away and affects all companies in the market. The other options - credit risk, diversifiable risk, and maturity risk - are specific types of risk that affect individual companies and can be mitigated through diversification or other risk management techniques.

Relevant Portion of an Asset's Risk Attributable to Market Factors