The average expected rate of return on an asset can be fully understood as the rate that
compensates for risk.

Name: The average expected rate of return on an asset can be fully understood as the rate that compensates for risk.
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Question

Quizplus · Accepted Answer

While the average expected rate of return does take risk into account, it is not solely based on compensating for risk. Other factors such as inflation and market conditions also play a role in determining the expected rate of return.

The Average Expected Rate of Return on an Asset Can