Expected returns are also called:

A) ex-post returns
B) ex-ante returns
C) cost of capital
D) required rate of return

Question

Expected returns are also called:

A) ex-post returns
B) ex-ante returns
C) cost of capital
D) required rate of return

Quizplus · Accepted Answer

Ex-ante returns are expected returns,whereas ex-post returns are realised returns.The CAPM is an ex-ante model,and it provides estimates of expected returns adjusted for risk.Thus,any application of the CAPM will require an estimate of the ex-ante or expected risk premium.

Expected Returns Are Also Called