The required rate of return is the payment demanded by the investor for foregoing present consumption.

Question

Quizplus · Accepted Answer

The required rate of return is the compensation expected by investors for deferring the use of their money and forgoing present consumption. It represents the minimum return that an investor expects to earn for compensating the risk and opportunity cost involved in investing their money in a particular asset or security. Therefore, option A is correct.

The Required Rate of Return Is the Payment Demanded by the Investor