1. An investor adds 10 automobile stock in his portfolio for diversification. He should be able to reduce his

a.Systematic Risk

b.Unsystematic Risk

c.None of the above

2. There is a acute shortage of automobile parts in the country due to a trade war. This is an example of

a.Systematic Risk

b.Unsystematic Risk

c.Nation Risk

3. The owner of a firm is 75 years and is ill. He doesnt have any plans for inheritance. As an investor owning stock in this firm, you are exposed to:

a.Systematic Risk

b.Unsystematic Risk

c.Company Risk

4. If the risk free rate of a firm reduces, how would the present value of firm change

a.Decrease

b.Increase

c.No change

5. How does Valuation of a Company change if tax rate increase?

Select one:

a.Increases

b.Decreases

c.No Change

6. How should the EV of a Company change if the leverage of the Company changes?

a.Increase

b.Decrease

c.No change