Question 12

1. Winnder Li is considering investing in Ford Motor Company. Which of the followingare examples of diversifiable risk?

   a. Risk resulting from possibility of a stock market crash.

   b. Risk resulting from uncertainty regarding a possiblestrike against Ford.

   c. Risk resulting from an expensive recall of a Ford product.

   d. Risk resulting from interest rates decreasing.

   	I.	a only
   	II.	a and d only
   	III.	b and c only
   	IV.	a, b, c, and d
   	V.	None of the options specified here

Question 11

1. Which of the following has a beta of one?

   	I.	risk-free asset
   	II.	the market
   	III.	All Common stocks
   	IV.	All corporate bonds
   	V.	None of the options specified here