Which one of the following is the best example of systematic

Which one of the following is the best example of systematic risk? 1) inflation is exceeding the market expectations 2) a firm\'s CEO suddenly resigned growth in the oil exploration industry is slowing 4) individuals spending less on footwear

Solution

Example for Systematic risk in the given question is Inflation is exceeding market expectations

Risk can be classified into two – systematic and unsystematic risk

Systematic risks are those risk that effect the entire market and not just a particular stock or industry.

It is also known as diversifiable risk

They are unpredictable and impossible to avoid fully

They cannot be mitigated through diversification