Question: Ri = [Rf + ((Rm - Rf) x Bi)] Please define and explain the following components: Ri Rf (Rm - Rf) Bi What does the

Ri = [Rf + ((Rm - Rf) x Bi)]

Pleasedefineandexplainthe following components:

  • Ri
  • Rf
  • (Rm - Rf)
  • Bi

What does the CAPM tell us about the required return on a risky investment?

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