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Suppose you forecast that the standard deviation of the market return will be 15% in the coming year. If the Elry - measure of risk

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Suppose you forecast that the standard deviation of the market return will be 15% in the coming year. If the Elry - measure of risk aversion in A = is A = 4. ox Note: variance is squared of the standard deviation. What would be a reasonable guess for the expected market risk premium? What value of A is consistent with a risk premium of 9%? What will happen to the risk premium if investors become more risk tolerant

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