A typical measure for the risk-free rate of return is the
A)U.S.Treasury Bill rate.
B)prime lending rate.
C)money market rate.
D)short-term AAA-rated bond rate.

Question

Quizplus · Accepted Answer

The U.S. Treasury Bill rate is often considered the most accurate measure of the risk-free rate of return because it is backed by the full faith and credit of the U.S. government and is therefore considered to have no default risk. The other options listed may also be used as proxies for the risk-free rate, but are not as reliable or universally accepted.

A Typical Measure for the Risk-Free Rate of Return Is