Select 2–3 of the topics below and discuss how they each influence financial decisions regarding risk and return: The capital asset pricing model

Select 2–3 of the topics below and discuss how they each influence financial decisions regarding risk and return: The capital asset pricing model

Investors need to know how much risk they have to take to confidently expect a certain percentage return. Likewise, managers want to know what return shareholders require so that they can decide how to meet those expectations.

Respond to the following in a minimum of 450 words:

  • Select 2–3 of the topics below and discuss how they each influence financial decisions regarding risk and return:
  • The capital asset pricing model (CAPM)
  • The constant–growth model
  • Compute forward-looking expected return and risk
  • Risk premiums

A minimum of 3 paraphrased quotations from 3 different sources is required. (APA format citation)

Answer preview for Select 2–3 of the topics below and discuss how they each influence financial decisions regarding risk and return: The capital asset pricing model

FD
APA

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