T12.20 Chapter 12 Quick Quiz (continued)
Now let’s use our knowledge of capital market history to make some financial decisions.
- Suppose the current T-bill rate is 5%. An investment has “average” risk relative to a typical share of stock. It offers a 10% return. Is this a good investment?
- Suppose an investment is similar to buying small company equities. If the T-bill rate is 5%, what return would you demand?