Multiple Choice
When the CAPM is used to estimate the cost of equity capital,the expected excess market return is equal to
A) the return on the stock minus the risk-free rate.
B) the difference between the return on the market and the risk-free rate.
C) beta times the market risk premium.
D) beta times the risk-free rate.
E) the market rate of return.
Correct Answer:
Verified
Correct Answer:
Verified
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