Country premium and risk free rate on qbank computer, equation, services, company

irlfaan7

Why are they not subtracting the risk free rate in the CAPM equation for this problem? _________________________

Jamal Winfield is an analyst with Stolzenbach Technologies, a major computer services company based in the U.S. Stolzenbach?

orang3eph

Please note, it is "Market Risk Premium", which is 6% and NOT "Expected Market Return".

"Market Risk Premium" = E[Mkt] - RFR

So, RFR has already been subtracted, when using "Market Risk Premium".

Hope this clarifies.