In the equation for expected return from the CAPM, the only input specific to the firm in question is... O. the risk-free rate. O. the market risk premium. O. beta. O. all of the above.
Risk and return
Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary.
Capital Asset Pricing Model
Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.
In the equation for expected return from the CAPM, the only input specific to the firm in question is...
O. the risk-free rate.
O. the market risk premium.
O. beta.
O. all of the above.
Step by step
Solved in 3 steps with 1 images
