Other things being equal, as the risk-free rate increases, the required rate of return declines at a faster rate.

Name: Other things being equal, as the risk-free rate increases, the required rate of return declines at a faster rate.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

As the risk-free rate increases, the required rate of return on an investment typically increases as well, because investors demand higher returns to compensate for the opportunity cost of not investing in risk-free assets.

Other Things Being Equal, as the Risk-Free Rate Increases, the Required