Which of the following statements is false?
A) Fluctuations of a stock's returns that are due to firm-specific news are common risks.
B) The volatility in a large portfolio will decline until only the systematic risk remains.
C) When we combine many stocks in a large portfolio, the firm-specific risks for each stock will average out and be diversified.
D) The risk premium of a security is determined by its systematic risk and does not depend on its diversifiable risk.
Correct Answer:
Verified
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Consider an
Q68: Common risk is also called
A) firm-specific risk.
B)
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Q74: Which of the following statements is false?
A)
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Q76: It is only those risks that _
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