Compound annual risk premium on the real estate investment

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Given a real-estate property is expected to yield 2% per quarter (nominal) with a standard deviation of the (effective) quarterly rate of 10%. How do you compute the continous compound annual risk premium on the real estate investment? Spefically, how do you determine the risk free rate? See Ch. 5 problem 18 part b Investments by Brodie, Kane, MarcusTenth Edition.

Reference no: EM131309631

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