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Explain what is meant by business and financial risk

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Question 1: Explain what is meant by business and financial risk. Suppose Firm A has greater business risk than Firm B. Is it true that Firm A also has a higher cost of equity capital? Explain. What are the basic assumptions behind the Markowitz portfolio theory? Why Diversification Reduces or Eliminates Firm-Specific Risk: Give an Intuitive Explanation

Reference no: EM132588407

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