Which of the following is the rate of return required over and above the risk-free-rate?
A) Risk of time
B) Level of risk
C) Risk premium
D) Liquidity premium
E) None of the above

Question

Quizplus · Accepted Answer

The rate of return required over and above the risk-free rate is known as the risk premium. This is the additional return needed to compensate for the level of risk associated with a particular investment. It is calculated as the difference between the expected return on an investment and the risk-free rate. Therefore, option C is the correct answer. Options A, B, and D are incorrect as they do not accurately describe the rate of return required over and above the risk-free rate.

Which of the Following Is the Rate of Return Required