CFA Practice Question

There are 201 practice questions for this study session.

CFA Practice Question

The typical build-up model for estimating the cost of common equity capital may consist of all of the following components EXCEPT:

I. A risk-free rate.
II. Beta.
III. A general equity risk premium.
IV. A size premium.
Correct Answer: II

The build-up method excludes the application of beta to the equity risk premium.

User Contributed Comments 0

You need to log in first to add your comment.