Question: One of the basic principles of finance is that all risk is not equal since some risk can be diversified away and some cannot. The process of diversification can reduce risk, and as a result, measuring a project's or an asset's risk is very difficult. Research and discuss the topic of diversification.
1. What is diversification? Give some examples. Does this impact the financial management of an organization? If so, how? If not, why not? Do organizations embrace diversification as a guideline? If so, how? If not, why not?