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Which of the Following Statements Is True

Question 42

Multiple Choice

Which of the following statements is true?


A) Systematic risk is also referred to as idiosyncratic risk, while unsystematic risk is also referred to as implicit risk.
B) Unsystematic risk is also referred to as implicit risk, while systematic risk is also referred to as idiosyncratic risk.
C) Systematic risk can be reduced by diversification, while unsystematic risk cannot be reduced by diversification.
D) Unsystematic risk can be reduced by diversification, while systematic risk cannot be reduced by diversification.

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