The most difficult CAPM input to estimate is the
A)market beta of the project.
B)risk-free interest rate.
C)standard deviation.
D)equity premium.

Question

Quizplus · Accepted Answer

The equity premium is the most difficult CAPM input to estimate because it represents the additional return that investors require for taking on the risk of investing in equities over the risk-free rate. This premium can vary significantly based on market conditions and the perceived riskiness of equities, leading to a wide range of estimates from different sources.

The Most Difficult CAPM Input to Estimate Is the