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Unsystematic/systematic risk

The following scenarios would be represented as follows:
1a. The company under investigation for fraudulent accounting practices would be a specific, unsystematic risk. The company is a whole and not part of another organization. This company bears the sole responsibility if they go down the tubes financially.
1b. A terrorist attack on the United States could be both but I would lean more to a specific, unsystematic risk. Terrorists are targeting us specifically so the risk would be unsystematic although what would follow is economic chaos again. The last terrorist attack changed how we do business in not just one financial area but many different areas which would affect the market systematically.
1c. A large increase in oil could be risk a mixture of both but I would say it is a systematic risk. This type of risk is unavoidable no matter how much diversification there is. Rising or falling oil prices are usually governed by the current economic and market condition and th...

Posted by: Gina Allred

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