Calculate the required rate of return of an asset using the capital asset pricing model (CAPM) The equation: Where = required return on asset j = risk-free rate of return, commonly measured by the return on a Treasury bill = beta coefficient or index of non-diversifiable risk for asset j = market return; return on the market portfolio of assets
Calculate the required rate of return of an asset using the capital asset pricing model (CAPM) The equation: Where = required return on asset j = risk-free rate of return, commonly measured by the return on a Treasury bill = beta coefficient or index of non-diversifiable risk for asset j = market return; return on the market portfolio of assets
FIN2601-Study-Unit-4.docx