Because the Market Return Represents the Return on an Average

question 71

True/False

Because the market return represents the return on an average stock,that return carries risk with it.As a result,there exists a market risk premium which is the amount over and above the risk-free rate that is required to compensate an investor for assuming an average amount of risk.

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Definitions:

Personal Mission Statement

A written declaration of an individual's core purpose and focus that serves as a guide to their actions and decisions.

Self-Assessment

The practice of evaluating one's own abilities, performance, or qualities, often for the purpose of self-improvement.

Critical Thinking

The process of analyzing information and arguments in order to make reasoned judgments that are logical and well thought out.

Negative Thoughts

Instances of pessimistic or discouraging ideas that can impede one's emotional well-being and performance.