Use the following information to answer the question(s) below

Assume that the risk-free rate of interest is 3% and you estimate the market's expected return to be 9%.
-The risk premium for "Meenie" is closest to:
A)4.50%.
B)7.50%.
C)9.30%.
D)9.75%.

Question

Use the following information to answer the question(s) below

Assume that the risk-free rate of interest is 3% and you estimate the market's expected return to be 9%.
-The risk premium for "Meenie" is closest to:
A)4.50%. 
B)7.50%. 
C)9.30%. 
D)9.75%.

Quizplus · Accepted Answer

The risk premium is calculated as the difference between the expected return on an investment and the risk-free rate. Without specific values provided, the choice closest to a typical risk premium for a moderate-risk investment is 4.50%.

Use the Following Information to Answer the Question(s) Below