I’m looking for the answer to this question and how u got it. Which of the following best explains why total risk is used in project analysis?

I’m looking for the answer to this question and how u got it.
Which of the following best explains why total risk is used in project analysis?
1) Insolvency & bankruptcy may result from high total risk
2) It is impossible to estimate a project’s beta
3) A firm’s projects are mutually exclusive
4) Shareholders diversify their investment in many projects