Question
Which of the following best describes the role of the
Capital Asset Pricing Model (CAPM) in determining the required return on an asset in the capital market ?Solution
The Capital Asset Pricing Model (CAPM) estimates the required return on an asset by considering the systematic risk (beta) of the asset relative to the market . It uses the risk-free rate (such as the return on government bonds) and the market risk premium (the return expected from the market above the risk-free rate). This model assumes investors are rational and markets are efficient, helping investors make decisions based on the expected return given the asset's risk.
A company fails to accrue wages for March that will be paid in April. The company’s year-end balance sheet liabilities:
ABC Ltd has its Earning before Interest and Tax as 45000. The tax rate applicable for the year is 25%. It has made a capital expenditure of Rs 22500 and...
A company did sales of Rs.1 lakh during the year. It had total purchases of Rs.75000 of which Rs.2000 worth was returned. The company paid Rs.2000 for c...
The adjustments required in cash flow from operations to find free cash flow to the firm are:
What was the increase in the insurance density in India in FY24 as per economic survey 2023-24?
The theory which focusses on consequences of greater good and evil ___________.
- The negotiable warehouse receipt (NWR) system was launched in which of the following year?
Which of the following is/are included in the capital budget of the Government of India?
1. Expenditure on acquisition of assets like roads, bui...
What is the maturity period of External Commercial Borrowings?
When the equity shares are issued at a price above the face value, the excess price received over the face value of shares, is credited to which of the ...
