__________ arises from decisions that affect the left-hand side of the balance sheet, while __________ arises from decisions that affect the right-hand side of the balance sheet.
A) Systematic risk; financial risk.
B) Business risk; financial risk.
C) Unsystematic risk; systematic risk.
D) Business risk; diversifiable risk.
E) Systematic risk; unsystematic risk.

Question

__________ arises from decisions that affect the left-hand side of the balance sheet, while __________  arises from decisions that affect the right-hand side of the balance sheet.
A) Systematic risk; financial risk.
B) Business risk; financial risk.
C) Unsystematic risk; systematic risk.
D) Business risk; diversifiable risk.
E) Systematic risk; unsystematic risk.

Quizplus · Accepted Answer

Business risk arises from decisions that affect the left-hand side of the balance sheet, such as investments in assets, which is related to the operations of the company. Financial risk arises from decisions that affect the right-hand side of the balance sheet, such as the use of debt financing.

__________ Arises from Decisions That Affect the Left-Hand Side of the Balance