The risk premium for a capital investment by comparing the expected return on that investment with the expected return on the entire stock market is measured by

Related MCQs

• Non diversifiable risk affects I. the opportunity cost of capital II. should enter into the risk premium
• A market participant who obeys the principles of rational expectations will base his or her expectations of market price on
• Which criterion refers to economic efficiency which can be objectively measured
• When the average buyer of an insurance policy is likely to have higher risk than others in his class, this is known as
• When people behave in ways that involve increased risk because they have insurance, this is known as
• Diversifiable risk can be eliminated by
• Non diversifiable risk arises because
• In volatile markets, “speculators” would be expected to provide some stability because
• Several combination of commodities x and y that the economy can produce by fully utilizing all of the fixed amounts of labour and capital with the best technology available is depicted by I. production possibility frontier II. transformation curve III. production possibility curve
• Market failure can occur when