Risk that affects many businesses at the same time is called risk, while risk associated with individual businesses is called risk. a. asymmetric; symmetric b. idiosyncratic; systematic c. systematic; idiosyncratic d. symmetric; asymmetric

the answer is c, Systematic; idiosyncratic

Explanation:

A risk that affects many businesses at the same time time is called a systematic risk. This is because it affects the whole market of that particular business everywhere in an area or country, etc. This means that the problem cannot be solved easily by going into something else (diversification).

For example, consider the sudden infection of cotton due to global warming. it means that production of cotton clothes is a risk for every fashion house.

On the other hand, Idiosyncratic risk is that type of risk that is peculiar to an individual business. it is a type of risk that affects a particular person in his or her business and he or she can solve that risk by switching to another business (diversification).

Take for example the cotton infection stated above. this time we will assume that cotton is affecting xyz fashion house from its supplier and thers no other supplier around an cost effective, xyz fashion can switch to making wool clothes and still remain in business.

i hope this helps. CHEERS.

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