The excess return required from an investment in a well-diversified portfolio ov

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The excess return required from an investment in a well-diversified portfolio over that required from a risk-free investment Risk-averse investors dislike risk and require higher rates of return as an inducement to buy riskier assets. The excess return required from an investment in a risky asset over that required from a risk-free investment The difference between the rate of return of a specific asset and the rate of return of a less risky asset. None of the above. QUESTION 2 1 po Beta A measure of the extent to which two stocks are related. A measure of the idiosyncratic risk present in an asset. A measure of a stock s price. A measure of the sensitivity of expected returns of a risky asset to movements in the market portfolio None of the above. Cliek Save and Submit to save and submit. Click Save All Answers to save all answers Save All Answers

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Dear Student Thank you for using Chegg Please find below the answer and please give thumbs up   Statementshowing Computations Paticulars Q1 Market risk premium is the excess return required from an investment in a well diversified portfolio over that required from a risk free investment Risk premium = Return on market - risk free return Q2 Beta is a measure of the sensitivity of expected return of a risky asset to movement in the market portfolio

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