- CFA Exams
- CFA Level I Exam
- Topic 3. Corporate Issuers
- Learning Module 6. Capital Structure
- Subject 2. Factors Affecting Capital Structure
CFA Practice Question
Which of the following best describes the equity risk that arises from the nature of the firm's operating activities?
B. Diversifiable risk
C. Financial risk
D. Business risk
E. Systematic risk
A. Unsystematic risk
B. Diversifiable risk
C. Financial risk
D. Business risk
E. Systematic risk
Correct Answer: D
User Contributed Comments 5
| User | Comment |
|---|---|
| sarath | Business risk clearly comes from the firm's operating activities... |
| TreasureH | Not diversifiable risk. |
| kolkata7 | y unsystematic is not the ans?? its company specific...acc to me ans should be a & d |
| robbiecow | At a very basic level with a lot of stuff stripped out, this is what I think the separating line is: Unsystematic Risk: Risk involved when an individual invests in a particular firm or industry. Business Risk: Risk involved when the firm invests in itself (i.e., uncertainty of operating earnings) |
| ewantanner | On point RobbieCow |