GK
ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Avoidable
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Systematic
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Unsystematic
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None of the above
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Detailed explanation-1: -The correct answer is Risk. Variability in the rate of return is known as Risk. Variability, in general, refers to the divergence of data from its mean value.
Detailed explanation-2: -variance is a measure of the variability of returns, and since it involves squaring the deviation of each actual return from the expected return, it is always larger than its square root, the standard deviation.
Detailed explanation-3: -The Capital Asset Pricing Model (CAPM) describes the relationship between systematic risk and expected return for assets, particularly stocks.
Detailed explanation-4: -The Capital Asset Pricing Model (CAPM) describes the relationship between systematic risk, or the general perils of investing, and expected return for assets, particularly stocks.1 It is a finance model that establishes a linear relationship between the required return on an investment and risk.