Question
You read in the financial times that the equity risk premium has increased overnight from 5.5% to 6.5%. Which of the following statements is likely
You read in the financial times that the equity risk premium has increased overnight from 5.5% to 6.5%. Which of the following statements is likely to be correct?
A. The market return is higher than the risk-free rate
B. Investors risk aversion has increased
C. The beta of the market has increased
D. The SML has a steeper slope
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Multinational financial management
Authors: Alan c. Shapiro
10th edition
9781118801161, 1118572386, 1118801164, 978-1118572382
