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According to the CAPM,the Expected Return on a Risky Asset

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Essay

According to the CAPM,the expected return on a risky asset depends on three components.Describe each component,and explain its role in determining expected return.


Definitions:

Deficits

The amount by which a government's expenditures exceed its revenue.

Surpluses

Situations in which the quantity of a good or service supplied exceeds the quantity demanded at the current price.

Rubles

The official currency of Russia, symbolized as RUB, used for all financial transactions within the country.

Depreciation

A fall in the price of a nation’s currency relative to foreign currencies.

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