Unsystematic risk is not relevant, because
A) it does not change.
B) it can be eliminated through diversification.
C) it cannot be estimated.
D) it cannot be eliminated through diversification.

Question

Quizplus · Accepted Answer

Unsystematic risk, also known as company-specific risk, can be reduced or eliminated through diversification. Therefore, it is relevant but can be managed. The other options are incorrect because unsystematic risk can change, can be estimated, and can be reduced through diversification.

Unsystematic Risk Is Not Relevant, Because