If a financial asset has an expected return that is greater than what is necessary to...

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If a financial asset has an expected return that is greater than what is necessary to...

If a financial asset has an expected return that is greater than what is necessary to compensate for its risk, what will bring the return back in line with equilibrium?

business finance

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Answer 1

Answer #1

Increase in Price (due to increased demand) or Increase in risk will bring the return back in line with equilibrium

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Answer 2

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