Which type of risk is unique to a firm and may be eliminated by diversification?

Select one:

a. Macro risk.

b. Unsystematic risk.

c. Systematic risk.

d. Total risk.

Over the past 10 years, large-company shares have returned 11.2%. The risk premium on these shares was 4.8% and the inflation rate was 3.7%. What was the risk-free rate of return?

Select one:

a. 2.7%

b. 6.4%

c. 7.5%

d. 8.5%

Private equity investments typically have

Select one:

a. a higher level of risk than most other investments.

b. a lower level of risk than most other investments.

c. 30% more risk than most other investments.

d. no risk than most other investments.