CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

True or False?

I. An example of systematic risk would be if the stock of airlines dropped after two airplanes crashed on the same day, making many passengers too nervous to fly.
II. Investors are willing to pay more for stocks with high systematic risk components.
Correct Answer: Both are false.

User Contributed Comments 3

User Comment
Gina it is not caused by macroeconomic factors nor does it affect all risky assets.
in effect stock of bus companies might increase.
akanimo risk can be diversified away by investing in other types of companies (say bus companies) ... so it cant be systematic risk
chcarnes Investors need to be compensated more for stocks with high systematic risk components
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