Although unique risk is present in differing amounts, individual stocks are:
A)Exposed to the same amount of market risk
B)Exposed to differing amounts of market risk also
C)Not exposed to market risk; only the general economy is subject to market risk
D)Able to diversify away their market risk

Question

Quizplus · Accepted Answer

Individual stocks are exposed to different amounts of market risk as they are affected by various external factors such as changes in interest rates, political events, global market conditions, etc. Therefore, the amount of market risk varies for different stocks.

Although Unique Risk Is Present in Differing Amounts, Individual Stocks