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A colleague of yours attended a short learning programme on financial management. One of the programme topics was the capital asset pricing model (CAPM). Your
A colleague of yours attended a short learning programme on financial management. One of the programme topics was the capital asset pricing model (CAPM). Your colleague asked you to please explain the following elements of the CAPM to her: - The risk-free rate of return - The beta coefficient () Required: Explain to your colleague what these two (2) concepts mean, ensuring that you indicate to her which interest rate is usually considered the risk-free rate
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