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What was the risk premium of the period

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Reference no: EM133189410

Question - Assume the S&P 500 (primary US stock market index) returned roughly an average of 11% per year over the 1990-2022 period. In addition, the average yield on 1-month US treasury bills over this period was 3.5%. Finally, long-term US government bonds with a 20-year average maturity returned an average of 5% per year over this period. Based on the above, what was the 'risk premium' of the S&P 500 over the period?

a) 11%

b) 6%

c) 7.5%

d) 1.5%

Reference no: EM133189410

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