Q753
Yield on bond is 7% and market required return is 14% then market risk premium would be
A.
2.00%
B.
21.00%
C.
0.50%
D.
7.00%
AnswerAnswer: Option D
Solution
Answer: Option D
Solution:
Market risk premium = Market required return - Yield on bond = 14% - 7% = 7.00%