Answer: b. The diversifiable risk of your portfolio will likely decline, but the expected market risk should not change.
Explanation:
Diversifiable risk is a risk that a particular security has or which can be seen in a certain sector. Market risk occurs when there's possibility that a particular investor will make loss due to certain factors which affects the entire market.
In the above scenario, the most likely to occur will be that the diversifiable risk of the portfolio will likely decline, but the expected market risk should not change.
It should be noted that diversification won't eliminate market risk. When more stocks are added, this brings about decline in diversification risk but market risk won't change.
Answer:
The statement is: True.
Explanation:
When a firm purchases its own shares they become part of the company's treasury stock. This usually happens when the organization intends to sell those shares in the future. According to the General Accepted Accounting Principles (<em>GAAP</em>), the transactions between a firm and its owners are not considered as profit-making. Thus, when a company reissues the treasury stock shares no revenues or losses are recorded.
Answer:
B
Explanation:
When we talk of a decreasing cost industry, we refer to an industry in which the expansion of the industry will lead to a decrease in the unit production cost.
So with respect to the question at hand , the correct answer is that the input prices will fall as industry expands
The case of a a technological improvement is expected to drive a decrease in the input prices for production in the expanding industry
Answer:
Skimming
Explanation:
Price skimming, also known as skim pricing, is a pricing strategy used by those who face little or no competion, what normally happens is that a firm charges a high price and then gradually may need to lowes the price to attract more customers.
Price skimming is used to earn large profits especiallyn when a new product or service is introduced into the market. The pricing strategy is largely useful iwhen the firm is the first to enter the marketplace. The aim of this is to generate the large profit in the shortest time possible.
Solutions for unexpected business environmental changes
