If the expected rate of return for the market is not much greater than the risk-free rate of return, what does this suggest about the general level of compensation for bearing systematic risk?

Is it true that the the wider the risk premium, the lower the price of a expected future cash flow?

Unsystematic risk: is compensated for by the risk premium. is measured by standard deviation. is related to the overall economy. can be effectively eliminated by portfolio diversification. is measured by beta.

A forward rate is the mathematical expectation of a future spot rate in risk neutral world. O True False

The systematic risk principle states that the expected return on a risky asset depends only on which one of the following? Unsystematic risk Market risk Diversifiable risk

How can an investor eliminate Systematic risk?

identify the assumptions underlying the interest coverage ratio appropriate measure for analyzing long-term solvency risk?  Alternatively, can you identify the assumptions underlying the interest coverage ratio appropriate measure for analyzing short-term solvency risk?

1) Let us start with what is the difference between a real and a financial asset? 2) What is the risk-return tradeoff?

Provide some idea of the effect of the sensitivity of security prices to changes in market interest rates?

What does Jensen's alpha measure? a. An investor's reward in proportion to their assumption of systematic risk b. The abnormal return of an asset, defined as the degree to which its actual return exceeds that predicted by the capital asset pricing model c. The degree to which diversifiable risk is eliminated d. How much reward an investor is getting for each unit of risk assumed