Question: If the future return on a security is known with absolute certainty, then the risk premium on that security should be equal to: Question 6

If the future return on a security is known with absolute certainty, then the risk premium on that security should be equal to:

Question 6 options:

zero.

the risk-free rate plus one-half the market rate.

the market rate.

the market rate minus the risk-free rate.

the risk-free rate.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!