True or false: Labor strikes are an example of systematic risk.True false question.TrueFalse
Question
True or false: Labor strikes are an example of systematic risk.True false question.TrueFalse
Solution
False. Labor strikes are an example of unsystematic risk, not systematic risk. Systematic risk refers to the overall impact of the market, which cannot be eliminated through diversification. Unsystematic risk, on the other hand, is company or industry-specific risk that can be reduced through diversification. Labor strikes, being specific to a particular company or industry, fall under the category of unsystematic risk.
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