Statistical formulas calculate portfolio risk

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Reference no: EM131312852

1) Which of the following risks confronting ABC Worldwide, Inc. is an example of a systematic risk?

A. A possible decline in the value of its holdings of short-term securities due to fluctuation in interest rates

B. A possible decline in its earnings due to a strike by its employees

C. A possible decline in the purchasing power of its net income due to inflations

D. A possible decline in its net worth due to the need to reinvest funds from an investment at a lower rate than was earned initially

2) Portfolio risks can be calculated. Which of the following statistical formulas calculate portfolio risk?

A. Capital Asset Pricing Model (CAPM)

B. Correlation coefficient

C. Beta

D. Standard deviation of the variance of returns

Reference no: EM131312852

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