Explain how to measure the market risk premium rpm

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Reference no: EM1395517

Q. When estimating the cost of equity by use of the CAPM, three potential problems are (1) whether to use long-term or short-term rates for rRF, (2) whether or not the historical beta is the beta which investors use when evaluating the stock, also (3) Explain how to measure the market risk premium, RPM. These problems leave us unsure of the true value of Rs.

Reference no: EM1395517

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