The Cost of Borrowing Money Is Called

question 69

Multiple Choice

The cost of borrowing money is called:

• A) inflation.
• B) return.
• C) interest.
• D) all of the above.

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Definitions:

Risk-free Rate

The return on an investment with no risk of financial loss, often associated with government bonds.

Required Return

The minimum expected yield by investors for providing capital to a company or project.

Betas

A measure of the volatility, or systematic risk, of a security or portfolio in comparison to the market as a whole, often used in the Capital Asset Pricing Model.

Standard Deviation

A statistical measure of variance or dispersion in a set of values, commonly used to assess investment risk.