Read the following scenarios and identify which involve
systematic risk (market-wide risk) and which involve unsystematic risk
(company- or industry-specific risk):

I. A sharp rise in interest rates by the Reserve Bank causes a
broad decline in the stock market.

II. A fire damages a major manufacturing facility owned by a listed electronics
company.

III. Global oil prices surge due to geopolitical tensions in the Middle East,
impacting energy and transport stocks.

IV. Tesla is boycotted, resulting in an 81% year-on-year drop in sales and a
sharp selloff in its stock.

V. A trade war between the US and other countries causes widespread disruption
in global supply chains.

Question

Read the following scenarios and identify which involve
systematic risk (market-wide risk) and which involve unsystematic risk
(company- or industry-specific risk):

I. A sharp rise in interest rates by the Reserve Bank causes a
broad decline in the stock market. 
 
II. A fire damages a major manufacturing facility owned by a listed electronics
company. 
 
III. Global oil prices surge due to geopolitical tensions in the Middle East,
impacting energy and transport stocks. 
 
IV. Tesla is boycotted, resulting in an 81% year-on-year drop in sales and a
sharp selloff in its stock. 
 
V. A trade war between the US and other countries causes widespread disruption
in global supply chains.

Answer

I, II, IV, and V are systematic risks; only III is
unsystematic

Answer

I and II are systematic risks; III, IV, and V are
unsystematic

Answer

I, III, and V are systematic risks; II and IV are
unsystematic

Answer

I and III are systematic risks; II, IV, and V are
unsystematic

Crowdly

Read the following scenarios and identify which involve systematic risk (market...

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