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The risk premium is: (with explanation) The difference between the price of a stock and the price of a bond. The additional return paid to

The risk premium is: (with explanation)

  1. The difference between the price of a stock and the price of a bond.

  2. The additional return paid to investors for their investments in risky assets relative to risk-free assets.

  3. The difference between the dividend yield (i.e., the percentage that the dividend per share represents in the price per share) of a stock and the coupon rate of a bond.

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