If the equity risk premium in a given country is 4%, which of the following statements is true?

Group of answer choices

The equity risk premium provides no information pertaining to the return required by investors

A company with a highly leveraged capital structure would have a higher equity risk premium

Equity market participants expect to earn a total return of 4% annually

Equity market participants require a return 4% above that of the risk-free rate to compensate for taking equity risk