Chapter 11: Risk & Return (12 questions, 1-12)

Chloe owns a risky stock and anticipates earning 10 percent on her investment in that stock. The risk free rate is now about 1 percent. Which one of the following best describes the 9 percent rate, the difference between these two rates, which is called ____________?

Group of answer choices

The risk premium on that stock

The market rate

The expected return

The real return