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True or False: Rafe, Inc. has a coefficient of variation equal to .6 while Rache, Inc. has a coefficient of variation of .9. On a

True or False: Rafe, Inc. has a coefficient of variation equal to .6 while Rache, Inc. has a coefficient of variation of .9. On a relative return and risk basis, therefore, Rafe is less risky than Rache.

T/F: Unsystematic risk is also called market risk and is undiversifiable.

T/F: Diversifiable risk for a firm is related to the unique risk factors of the firm. These might include business factors, financial factors, or the products or services sold by the firm.

T/F: The financial markets will pay investors for accepting systematic risk but not for accepting unsystematic risk.

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