Which of the following is a true statement?
A) The risk and return that a firm experienced in the past is also the risk level for its future.
B) Firms can quite possibly change their stocks' risk level by substantially changing their business.
C) If a firm takes on riskier new projects over time, the firm itself will become less risky.
D) If a firm takes on less risky new projects over time, the firm itself will become more risky.

Question

Quizplus · Accepted Answer

Firms can alter their risk profile by significantly changing their business operations or strategy, which can affect the risk level of their stocks. This is because the risk associated with a firm's stock is directly related to the firm's business activities and financial health.

Which of the Following Is a True Statement