When the home construction industry does poorly due to a recession, this is an example of:
A)Systematic risk
B)Idiosyncratic risk
C)Risk premium
D)Unique risk

Question

Quizplus · Accepted Answer

The poor performance of the home construction industry during a recession is an example of systematic risk, which is risk that is inherent in the entire market or economy as a whole. This type of risk cannot be diversified away, and affects a wide range of investments.

When the Home Construction Industry Does Poorly Due to a Recession