Over a certain period, large-company stocks had an average return of 12.49 percent, the average risk-free rate was 2.56 percent, and small-company stocks averaged 17.37 percent. What was the risk premium on small-company stocks for this period?
Added by Jo H.
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Step 1: Calculate the risk premium on small-company stocks by subtracting the risk-free rate from the average return of small-company stocks. Show more…
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