Assignment:
Q1. How do diversifiable and nondiversifiable risks affect a company’s cost of capital?
Q2. On what basis should a company’s managers decide which risks to hold and which to hedge?
Q3. How much cash flow risk should a company take on? How should it manage risks with extreme outcomes that could potentially bankrupt the company but are very unlikely to occur?
Your answer must be, typed, double-spaced, Times New Roman font (size 12), one-inch margins on all sides, APA format and also include references.