Question
When using the CAPM to estimate the cost of equity capital, the expected excess market return equals the: return on the stock minus the risk-free
When using the CAPM to estimate the cost of equity capital, the expected excess market return equals the:
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return on the stock minus the risk-free rate.
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return on the market minus the risk-free rate.
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beta times the market risk premium.
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beta times the risk-free rate.
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market rate of return.
Which one?
And why?
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Modeling Financial Time Series With S PLUS
Authors: Eric Zivot, Jiahui Wang
2nd Edition
0387279652, 0387323481, 9780387279657, 9780387323480
