If the risk adjusted discount rate method and the certainty equivalent methods are to give the same results, then the certainty equivalent factor (at) must equal (where rf is the risk-free interest rate, and "k" is the risk adjusted cost of capi
) A) (1 + rf)t times (1 + k)t.
B) (1 + k)t divided by (1 + rf)t.
C) (1 + rf)t divided by (1 + k)t.
D) (1 + k)t minus (1 + rf)t.
C
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If the CPI was 108.4 in Year 1 and was 109.7 for Year 2, then the rate of Inflation between Year 1 and Year 2 was:
(a) 2.2%. (b) 1.9%. (c) 2.9%. (d) 1.2%.
Every year, the U.S. allows 500,000 people from developing countries to immigrate to the U.S. permanently, which means:
A. many people resort to immigrating illegally. B. it has a lower rate of acceptance than admission rates to the most competitive U.S. colleges. C. there is a severe surplus, since 13.6 million apply to enter the U.S. D. All of these statements are true.
The price of a new textbook is $60 in one year and $75 two years later, while the price of a used copy of the textbook increased from $25 to $37.50. The relative price of a new textbook
A) increased by 25 percent. B) increased from 2.4 to 3. C) decreased from 2.4 to 2.0. D) decreased from 1.4 to 1.25.
A tax whose burden, expressed as a percentage of income, increases as income increases is
A. a progressive tax. B. an ability-to-pay tax. C. a regressive tax. D. a proportional tax.