The Minimum Return That Will Make an Investment Acceptable to an Investor

question 187

Multiple Choice

The minimum return that will make an investment acceptable to an investor is called:

• A)the required rate of return.
• B)the risk premium.
• C)the risk-free interest rate.
• D)beta.

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Definitions:

Consulting Revenues

Income generated by a firm through the provision of advisory or consultancy services.

Additional Investment

Extra funds invested into a business by its owners or shareholders over and above the initial or previous investments.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from revenue.

Owner's Equity

The residual interest in the assets of an entity after deducting liabilities, representing the ownership interest in the company.