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Systemic v Unsystemic Events

Classify the following events as mostly systematic or mostly unsystematic and tell us why. Is the distinction clear in each case?

a) Short term interest rates increase unexpectedly
b) The interest rate a company pays on its short term debt borrowing is increased by its bank.
c) Oil prices unexpectedly decline
d) An oil tanker ruptures, creating a large oil spill
e) A manufacturer loses a multimillion dollar product liability suit
f) A Supreme Court decision substantially broadens producer liability for injuries suffered by product users.

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Systematic v Unsystematic
Classify the following events as mostly systematic or mostly unsystematic and tell us why. Is the distinction clear in each case?
a) Short term interest rates increase unexpectedly
b) The interest rate a company pays on its short term debt borrowing is increased by its bank.
c) Oil prices unexpectedly decline
d) An oil tanker ruptures, creating a ...

Solution Summary

Solution helps in classifying the events as mostly systematic or mostly unsystematic and also give the reasons.

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