Systematic risk: Select one: 1. is related to the overall economy. 2. is measured by beta....

Systematic risk:

Select one:

1. is related to the overall economy.

2. is measured by beta.

3. is compensated for by the risk premium.

4. cannot be avoided if you wish to participate in the financial markets.

5. can be effectively eliminated through portfolio diversification.

Expert Solution

Solution:

Systematic Risk:

Right option is 2. is measured by beta.

Systematic Risk is also known as Market Risk or Un-diversifiable Risk that is unceratainty inherent to the Entrie Market Segment. and it is also Referred as Volatility. The Systematic Risk consists Fluctuations in the Day to day Stock's Price. Systematic Risk is Measured by the Beta.

jeff jeffy answered 2 years ago

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