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On Friday November 29, 2021, the CDC confirmed the first case of a new COVID variant, omicron, in California. The market declined 2% that day.

  1. On Friday November 29, 2021, the CDC confirmed the first case of a new COVID variant, omicron, in California. The market declined 2% that day. Which statement best describes this risk.
    1. This is a risk that could have been diversified and investors are not compensated for bearing it.
    2. This is a risk that could not be diversified and investors are compensated for bearing it.

This is a risk that could not be diversified and investors are not compensated for bearing it.

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