Which of the following provides the best example of a systematic risk event?
A)A strike by union workers hurts a firm's quarterly earnings.
B)Cattle disease in Queensland hurts local farmers and buyers of beef.
C)The Reserve Bank increases interest rates 50 basis points.
D)A senior executive at a firm embezzles $10 million and escapes to South America.

Question

Quizplus · Accepted Answer

The Reserve Bank increasing interest rates is an example of systematic risk as it affects the entire market, rather than just one specific company or industry. The other options are examples of unsystematic risk, as they only impact a specific company or industry.

Which of the Following Provides the Best Example of a Systematic