risk premium (RP) expected return on a portfolio,r^P realized rate of return, r¨ diversification correlation coefficient, ρρ firm-specific (diversifiable) risk market (nondiversifiable) risk relevant risk beta coefficient, ββ capital asset pricing model (CAPM) security market line (SML) market risk premium (RPM) equilibrium
risk premium (RP) expected return on a portfolio,r^P realized rate of return, r¨ diversification correlation coefficient, ρρ firm-specific (diversifiable) risk market (nondiversifiable) risk relevant risk beta coefficient, ββ capital asset pricing model (CAPM) security market line (SML) market risk premium (RPM) equilibrium
Chapter8: Analysis Of Risk And Return
Section: Chapter Questions
Problem 1QTD
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- risk premium (RP)
- expected return on a portfolio,r^P
- realized
rate of return , r¨ - diversification
- correlation coefficient, ρρ
- firm-specific (diversifiable) risk
- market (nondiversifiable) risk
- relevant risk
- beta coefficient, ββ
capital asset pricing model (CAPM)- security market line (SML)
- market risk premium (RPM)
- equilibrium
Define all terms
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