What is unsystematic risks, Financial Management

Assignment Help:

Q. What is Unsystematic Risks?

Unsystematic Risks stems from a managerial inefficiency, technological change in the production process, availability of raw material, changes in the consumer preference, and labor problems. The nature and magnitude of the above mentioned factors differ from industry to industry, and company to company. They have to be analyzed separately for each industry and firm. The changes in the consumer preference affect the consumer products like television sets, washing machines, refrigerators, etc. more than they affect the iron and steel industry. Technological changes affect the information technology industry more than that of consumer product industry. Thus, it differs from industry to industry. Financial leverage of the companies that is debt-equity portion of the companies differs from each other. The nature and mode of raising finance and paying back the loans involve a risk element. All these factors form the unsystematic risk and contribute a portion in the total variability of the return. Broadly, unsystematic risk can be classified into) Business risk ii) Financial risk


Related Discussions:- What is unsystematic risks

Specifications for contracts, S pecifications Following are the variou...

S pecifications Following are the various specifications that we need to apply while creating contracts. If the goods to be procured are covered under Bureau of Indian

What is meaning of perpetuity, What is meaning of Perpetuity If annuity...

What is meaning of Perpetuity If annuity is expected to go on forever then it is known as a perpetuity and then the above formula reduces to: Present value: A/i Perpetuit

Alternative dividend policies, The managing directors of three profitable l...

The managing directors of three profitable listed companies discussed their companies'' dividend policies at a business lunch. Company A; has deliberately paid no dividends for th

Capital structure, Modi Wires and Cable Ltd intends to finance its INR 20 m...

Modi Wires and Cable Ltd intends to finance its INR 20 million modernization plan for which it is trying to decide between debt and external equity. The management feels that the e

Profitability ratios, Profitability Ratios   Profit Margin  ...

Profitability Ratios   Profit Margin  It is a measure of the profit margin of the company. This is important to gauge the financial position of the company.

Market condition affecting cost of capital, Q. Market condition Affecting c...

Q. Market condition Affecting cost of capital? Market condition: if an investor is purchasing a security where the risk of the investment in significant the opportunity for add

Explain financial management in brief, Q. Explain Financial Management in b...

Q. Explain Financial Management in brief? In the management of business firms, there are various well known functional areas such as Production Management, Materials Management

Calculate the optimum amount of funds to transfer, Q. Calculate the optimum...

Q. Calculate the optimum amount of funds to transfer? The Baumol model is derived from the EOQ model and is able to be applied in situations where there is a constant demand fo

Option adjusted spread, The formula explained in the above paragraph ...

The formula explained in the above paragraph enables the investor to compute the value of a bond with an embedded option as the difference between the value of an

Issuer’s considerations, Issuer's Considerations Cash Flows: Issuers ma...

Issuer's Considerations Cash Flows: Issuers may consider the period for which the funds are required and try to spread the borrowings in a way to minimize the costs. Generally,

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd