Ask Question
12 January, 00:58

Suppose that the average annual return on the Standard and Poor's 500 Index from 1969 to 2005 was 14.8 percent. The average annual T-bill yield during the same period was 5.6 percent. What was the market risk premium during these 10 years?

+4
Answers (1)
  1. 12 January, 01:57
    0
    Market risk premium = 9.2%

    Explanation:

    The market risk premium is the difference between the market returns and the t bill yield. To calculate the market risk premium of this duration we will need to subtract the average annual t bill yield from the average annual return on the standard and poor's 500 index.

    14.8-5.6=9.2
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Suppose that the average annual return on the Standard and Poor's 500 Index from 1969 to 2005 was 14.8 percent. The average annual T-bill ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers