The required return on equity for an individual stock includes which of the following?

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The required return on equity for an individual stock includes systemic risk (market risk), idiosyncratic risk (unique or unsystematic risk specific to a company), and the risk-free interest rate. These components are all part of the Capital Asset Pricing Model (CAPM), which is used to determine a theoretically appropriate required rate of return of an asset, considering its risk relative to the market.

The Required Return on Equity for an Individual Stock Includes