Ask Question
BusinessBusiness
18 March, 09:30

The Risk Premium is:

a. The difference between the expected YTM and the YTM of the comparable risk-free bond.

b. The difference between the expected YTM and the Promised YTM of the bond

c. The difference between the YTM of a corporate bond in one industry and a comparable corporate bond in another industry

d. All of the above

e. None of the above

+4
Answers (1)
  1. 18 March, 11:47
    0
    The correct answer is letter "A": The difference between the expected YTM and the YTM of the comparable risk-free bond.

    Explanation:

    Risk Premium is a return that exceeds the risk-free rate of return that the investment is expected to yield. The risk premium for an asset takes the form of compensation for investors who tolerate the additional risk of an investment compared to the risk-free asset. In fact, investors expect to receive risk premiums because of the risk they are engaged in with certain investment instruments.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The Risk Premium is: a. The difference between the expected YTM and the YTM of the comparable risk-free bond. b. The difference between the ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers
You Might be Interested in
Where do you see yourself 5-10 years from now?
Answers (2)
Sparks Corporation has a cash balance of $14,700 on April 1. The company must maintain a minimum cash balance of $12,000. During April, expected cash receipts are $60,000. Cash disbursements during the month are expected to total $70,000.
Answers (2)
4. The inflation rate in the U. S. is 3%, while the inflation rate in Japan is 1.5%. The current exchange rate is $1 equal to 105 Japanese yen. If purchasing power parity condition is existed, what is the new exchange rate for the yen?
Answers (1)
In an Impress presentation, what is a transition?
Answers (1)
GAAP identifies several levels of influence/control. If Company One owns 10% of the outstanding voting stock of Company Two, which level of influence/control is in evidence? A. Fair-value method B. Significant Influence C. Control D. Passive E.
Answers (1)
New Questions in Business
Javier's employer pays for 43% of his annual health insurance premium. Javier pays the remaining balance by having it deducted from his paychecks in equal amounts twice a month throughout the year. If $157.
Answers (1)
Choose the BEST paraphrase of this sentence: Tashkent, the capital of Uzbekistan, has been an important market and trading place for hundreds of years.
Answers (1)
Economic exposure, a category of foreign exchange risk, is distinct from transaction exposure, which is concerned with the effect of exchange rate changes on individual transactions, most of which are short-term affairs that will be executed within
Answers (1)
According to liquidity preference theory, if there were a surplus of money, then A. the interest rate would be above equilibrium and the quantity of money demanded would be too large for equilibrium. B.
Answers (1)
Moonbeam Company manufactures toasters. For the first 8 months of 2017, the company reported the following operating results while operating at 75% of plant capacity: Sales (349,400 units) $ 4,372,000 Cost of goods sold 2,595,000 Gross profit
Answers (1)
Home » Business » The Risk Premium is: a. The difference between the expected YTM and the YTM of the comparable risk-free bond. b. The difference between the expected YTM and the Promised YTM of the bond c.
Sign Up Forgot Password?