Distinguish between the following: 'Systematic risk' and 'unsystematic risk'.

Systematic risk is also known as "market risk" or "un-diversifiable risk", is the uncertainty inherent to the entire market or entire market segment. On the other hand, controllable, internal factors which are peculiar to a particular industry or firm/(s) are known as unsystematic risk . In this way economic, political and sociological changes are sources of systematic risk. For example, if an economy moves into recession or if there is a political upheaval, it will cause the prices of nearly all the securities, whether bond or equity to decline. Conversely, unsystematic risk is the portion of the total risk that is unique to a firm or industry. It may be because of change in management, labour strikes which will impact the returns of only specific firms which are facing the problem. Firms with high systematic risk tend to be those whose sales, profits and stock prices follow the general trend in the level of economic or stock market activity. These may include companies that deal in basic industrial goods like automobile manufactures. Higher proportion of unsystematic risk are found in firms producing non durable consumer goods. Examples include suppliers of telephone, power and food stuffs.