Multiple Choice
The risk premium for an individual security is computed by:
A) adding the risk-free rate to the security's expected return.
B) multiplying the security's beta by the market risk premium.
C) multiplying the security's beta by the risk-free rate of return.
D) dividing the market risk premium by the beta of the security.
E) dividing the market risk premium by the quantity (1 - beta) .
Correct Answer:
Verified
Correct Answer:
Verified
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