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Anna11 [10]
3 years ago
8

The market risk premium is defined as __________. the difference between the return on an index fund and the return on Treasury

bills the difference between the return on a small-firm mutual fund and the return on the Standard & Poor's 500 Index the difference between the return on the risky asset with the lowest returns and the return on Treasury bills the difference between the return on the highest-yielding asset and the return on the lowest-yielding asset
Business
1 answer:
Paha777 [63]3 years ago
6 0

Answer:

The difference between the return on an index fund and the return on Treasury bills

Explanation:

The market risk premium explains critically the difference between an expected return on a given market portfolio and the risk-free rate.

It is also the additional return a given investor will receive (or is expected to gain) from holding a risky market portfolio instead of risk-free assets.

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