Standard deviation measures which type of risk?
A) Economic
B) Total
C) Systematic
D) Unsystematic
E) Non diversifiable

Respuesta :

Answer:

B) Total

Explanation:

Standard deviation measures total type of risk. Total risk is the risk due to unique factors to the stock as well as factors common to the market-the combined variation/volatility in stock returns. It is measured by standard deviation because standard deviation looks at historical returns only which capture both unique as well as market factors' combined effects. Standard deviation captures both systematic and unsystematic risk which combines into total risk