Risks will affect risk premium that investors will demand

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Reference no: EM13937674

Which of the following risks of a stock are likely to be firm-specific, diversifiable risks, and which are likely to be systematic risks? Which risks will affect the risk premium that investors will demand?

a. The risk that the founder and CEO retires.

b. The risk that oil prices rise, increasing production costs.

c. The risk that a product design is faulty and the product must be recalled.

d. The risk that the economy slows, reducing demand for the firm’s products.

Reference no: EM13937674

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