Risk Premium Is Defined As

question 230

Multiple Choice

Risk premium is defined as:

• A) The total return on a risky asset that exceeds the inflation rate.
• B) The return on a risky asset that exceeds the return on a risk-free asset.
• C) The risk-free rate of return plus the inflation rate.
• D) The real rate of return that exceeds the risk-free rate of return.
• E) The rate of return required by investors in risky assets.

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Definitions:

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