Question: The market risk premium is computed by: 1 adding the risk-free rate of return to the inflation rate. 2 adding the risk-free rate of return

The market risk premium is computed by:

1 adding the risk-free rate of return to the inflation rate.

2 adding the risk-free rate of return to the market rate of return.

3 subtracting the risk-free rate of return from the inflation rate.

4 subtracting the risk-free rate of return from the market rate of return.

5 multiplying the risk-free rate of return by the market beta.

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