Which of the following is not a component of the risk premium?
A) business risk
B) financial risk
C) liquidity risk
D) exchange rate risk
E) unsystematic market risk

Name: Which of the following is not a component of the risk premium? A) business risk B) financial risk C) liquidity risk D) exchange rate risk E) unsystematic market risk
Brand: Quizplus
Rating: 4.7 (33 reviews)

Question

Quizplus · Accepted Answer

Unsystematic market risk is not a component of the risk premium because it can be diversified away, unlike the other risks listed which contribute to the risk premium.

Which of the Following Is Not a Component of the Risk