All categories

3 years ago

What type of risk is eliminated through diversification?

Business

2 answers:

Helen [10]3 years ago

7 0

Answer:

<u><em>Unsystematic risk</em></u>

Explanation:

This risk is inherent in a specific company or industry. Then diversification helps to avoid this risks as investments are made in different companies and industries.

Annette [7]3 years ago

3 0

The risk that diversification helps us overcome is known as an unsystematic risk.

<u>Explanation:</u>

As the name suggests, it means a situation of a company being affected by a risk that doesn’t exist in other industries. It only takes place in a specific industry. Diversification is taken up to reduce this risk; the companies invest in various sectors rather than sticking to one specific sector.

It also involves allocating various financial instruments for investments. Diversification targets the returns and helps in improving it as the company invests in various categories that perform differently and differ in reactions too.

You might be interested in

I want to start my own brand & build a fashion empire. Should I go to a fashion college or to a business school?

Iteru [2.4K]

Answer:

Honestly, business would be much better for you. Learning business will give you many more opportunities and learn how to sell your products. Business will help you with marketing, pricing, discounting, and know how to "not get effed over." I believe that would be much better for you THEN go to fashion college.

8 0

2 years ago

What organization is charged with developing policies to protect u.s. transportation, especially in airport security and the pre

bogdanovich [222]

Department of transportation.

8 0

3 years ago

The trial balance for Swifty Corporation appears as follows:

Shkiper50 [21]

Answer:

Explanation:

The adjusting entry for supplies is shown below:

Supplies expense A/c Dr $115

To supplies A/c $115

(Being adjusted entry recorded)

The trial balance show a supplies balance of $148 and the supplies on hand were $33, so the adjusted supply balance would be equal to

= Supplies balance - supplies on hand

= $148 - $33

= $115

8 0

3 years ago

A family spends $56,000 a year for living

vovangra [49]

If a family spends $56,000 a year for living expenses. If prices increase 5 percent a year for the next four years, the amount that the family need for their annual living expenses after four years is $68,068.35.

<h3>Annual living expenses</h3>

Using this formula

Amount=Amount spent× (1+ rate)^ Number of years

Let plug in the formula

Amount=$56,000× (1+0.05)^4

Amount=$56,000× (1.05)^4

Amount=$68,068.35

Therefore If a family spends $56,000 a year for living expenses. If prices increase 5 percent a year for the next four years, the amount that the family need for their annual living expenses after four years is $68,068.35.

Learn more about Annual living expenses here:brainly.com/question/26383826

#SPJ1

8 0

1 year ago

Coast to Coast Surfboards Inc. manufactures and sells two styles of surfboards, Atlantic Wave and Pacific Pounder. These surfboa

podryga [215]

Answer:

Contribution margin ratio:

For East Coast = 10%

For West Coast = 8.05%

Explanation:

As per the data given in the question,

Contribution margin by sales territory report :

C C S Inc.

Contribution margin by Territory

Particulars East Coast West Coast

Sales (a) $8,400,000 $8,610,000

(30,000×$280)+(0×$130)

(21,000×$280)+(21,000×$130)

Less: variable cost of goods sold(b) $6,600,000 $6,657,000

(30,000×$220)+(0×$97)

(21,000×$220)+(21,000×$97)

Manufacturing margin (c=a-b) $1,800,000 $1,953,000

Less: Variable selling expense (d) $960,000 $1,260,000

(30,000×$32)+(0×$28)

(21,000×$32)+(21,000×$28)

Contribution margin (e=c-d) $840,000 $693,000

For East Coast:

Contribution margin ratio = (Contribution margin ÷ Sales revenue)×100

=($840,000÷ $8,400,000)×100

= 10%

For west coast:

Contribution margin ratio = (Contribution margin ÷ Sales revenue)×100

=($693,000 ÷ $8,610,000)×100

= 8.05%

4 0

3 years ago