Company risk premium A company has a beta 1.81. If a market return is expected to be 18.6% and the risk free rate is 6.30%, what is the company’s risk premium?

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Company risk premium A company has a beta 1.81. If a market return is expected to be 18.6% and the risk free rate is 6.30%, what is the company’s risk premium?

12.30
26.71
22.26
28.56

1 Answer

0
Darshita6.14K 0 Comments

Answer: 12.30 %

Working notes for the above answer is as under

market risk premium

=market return  – the risk free rate

= 18.6% -6.30%

= 12.30%

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