There are three components in the rate of return used to value a business.The component(s)are:
A)risk-free return.
B)an inflation premium.
C)the risk allowance for investing in the particular business.
D)All of the above

Question

Quizplus · Accepted Answer

All of the above components are necessary to calculate the rate of return used to value a business. The risk-free return represents the return that could be obtained from a riskless investment, the inflation premium adjusts for the expected inflation rate, and the risk allowance accounts for the additional return required to compensate for the risks associated with investing in the particular business.

There Are Three Components in the Rate of Return Used