Question
Over the past ten years, large company stocks have returned 11.2%. The risk premium on these stocks was 4.8% and the inflation rate was 3.7%.
Over the past ten years, large company stocks have returned 11.2%. The risk premium on these stocks was 4.8% and the inflation rate was 3.7%. What was the risk free rate of return?
Step by Step Solution
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Step: 1
To calculate the riskfree rate of return using the Capital Asset Pricing Mode...
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Contemporary Financial Management
Authors: James R Mcguigan, R Charles Moyer, William J Kretlow
10th Edition
978-0324289114, 0324289111
