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Mariulka [41]
2 years ago
15

Which one of the following represents the amount of compensation an investor should expect to receive for accepting the unsystem

atic firm-specific risk associated with an individual security?A. Security beta multiplied by the market rate of returnB. Market risk premiumC. Risk-free rate of returnD. Zero
Business
1 answer:
Evgesh-ka [11]2 years ago
8 0

Answer:

The correct answer is letter "D": Zero.

Explanation:

While dealing with an asset out of an unsystematic firm-specific risk <em>there is no compensation to expect</em> from a firm since it is the individual who is taking the risk in trading that asset. All responsibility relies on the individual's strategy when placing a transaction but the firm does not have any responsibility for having the individual accept that security.

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