The Theoretical Basis from Which the Concept of Risk-Adjusted Discount

question 71

Multiple Choice

The theoretical basis from which the concept of risk-adjusted discount rates is derived is

• A) the capital asset pricing model.
• B) simulation theory.
• C) the basic cost of money.
• D) the Gordon model.

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Definitions:

Z-statistic

A statistical measure that quantifies the difference between a sample statistic and its population parameter, measured in units of the standard deviation.

Z-test

A statistical test used to determine whether there is a significant difference between the mean of a sample and the mean of a population, or between the means of two populations.

Z-statistic

A type of standard score that indicates how many standard deviations an element is from the mean of its distribution.

Z-test

A statistical test used to determine whether there is a significant difference between the mean of a sample and the population mean, assuming the distribution is normal.