Which two of the following describe the two stages of estimating the relevant risk premium on a firm's equity?
A) Adjust the risk premium for a typical share to suit the risk level of the particular company's shares.
B) Compare the expected return from equities with the return provided by bonds.
C) Assess the capital asset price.
D) Estimate the average return demanded by investors above the risk- free return to induce them to buy average- risk shares.
Correct Answer:
Verified
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