The ________ on an Asset Is the Expected Return on the Asset

question 9

Multiple Choice

The ________ on an asset is the expected return on the asset in excess of the return on a risk-free asset.

• A) risk premium
• B) covariance
• C) systematic risk
• D) beta

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Definitions:

Bank Deposit

Funds placed into a banking institution for safekeeping, which can include savings accounts, checking accounts, and certificates of deposit.

Inventory Cycle

The process or time frame from when inventory is acquired to when it is sold, highlighting inventory management efficiency.

Financing Receivables

A type of financial activity where a company uses the money it is owed from customers (accounts receivable) as collateral for a loan.

Discount Period

The time span between the present date and the maturity date of a bill of exchange or other negotiable instrument during which it is sold at below its face value.