The equity premium is 8.8% and the risk -free rate is 4.6%. What is the expected...

Question

Question

The equity premium is 8.8% and the risk -free rate is 4.6%. What is the expected return on the market portfolio?

business finance

Answer 1

Answer #1

Correct option is > D. 13.40%

Equity risk premium = Expected return on market - Risk free rate

8.8% = Expected return on market - 4.6%

Expected return on market = 8.8%+4.6%

Expected return on market = 13.40%

Answer 2

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