Financial risk is: Multiple Choice irrelevant to the value of a company. inversely related to the cost of equity. a type of unsystematic risk. the risk inherent in a company’s operations. dependent upon a company’s capital structure.

Financial risk is: Multiple Choice irrelevant to the value of a company. inversely related to the cost of equity. a type of unsystematic risk. the risk inherent in a company’s operations. dependent upon a company’s capital structure.

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter13: Capital Budgeting: Estimating Cash Flows And Analyzing Risk

Section: Chapter Questions

Problem 11Q

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Question

100%

Financial risk is:

Multiple Choice

irrelevant to the value of a company.
inversely related to the cost of equity.
a type of unsystematic risk.
the risk inherent in a company’s operations.
dependent upon a company’s capital structure.

Definition Definition Amount of return a company generally pays to its equity investors. The cost of equity represents the compensation required by the market in lieu of owning the asset firm and simultaneously bearing the risk of ownership.

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