In applying the CAPM to estimate the cost of equity capital, which of the following elements is not subject to dispute or controversy?
A) The expected rate of return on the market, rM.
B) The stock's beta coefficient, bi.
C) The risk-free rate, rRF.
D) The market risk premium (RPM).
E) All of the above are subject to dispute.

Question

Quizplus · Accepted Answer

All elements listed are subject to dispute or controversy due to varying assumptions, estimations, and market conditions.

In Applying the CAPM to Estimate the Cost of Equity