Which One of the Following Is Expressed as "E(R_M)- R_f

question 2

Multiple Choice

Which one of the following is expressed as "E(R_M) - R_f"?

• A) market risk premium
• B) individual security risk premium
• C) real rate of return
• D) total expected rate of return
• E) market rate of return

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Definitions:

Marginal Cost

The cost incurred by producing one additional unit of a product or service.

Marginal Benefit

The additional satisfaction or utility gained by consuming an additional unit of a good or service.

Marginal Cost

The extra expense involved in creating an additional unit of a product or service.

Constant Marginal Costs

A situation where the cost of producing one more unit of a good or service remains unchanged regardless of the volume of production.