The capital asset pricing model (CAPM)

    Investors need to know how much risk they have to take to confidently expect a certain percentage return. Likewise, managers want to know what return shareholders require so that they can decide how to meet those expectations. Respond to the following in a minimum of 175 words: Select 2–3 of the topics below and discuss how they each influence financial decisions regarding risk and return: The capital asset pricing model (CAPM) The constant–growth model Compute forward-looking expected return and risk Risk premiums