Answer (B) is correct . Security risk is the risk of a single stock, whereas portfolio risk is its risk if it is held in a large portfolio of diversified securities. Portfolio risk therefore includes diversifiable and undiversifiable risk.
Answer (A) is incorrect because Interest rate risk is the risk of changes in interest rates.
Answer (C) is incorrect because Portfolio risk is the net risk of multiple securities.
Answer (D) is incorrect because Market risk is undiversifiable risk.
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