To calculate the default risk premium, the rate of return for a risk-free purchase must be subtracted from the rate of return for a purchase that is considered being made. The rate of return for a risk free purchase mean... More »

Market risk premium is calculated by first finding the expected return of an asset or portfolio. The risk-free rate of return is then determined and subtracted from this expected return to arrive at market risk premium. More »

The formula to calculate return on investment is ROI = (gain from investment - cost of investment) / cost of investment. The subsequent result is expressed as a ratio or a percentage. More »

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The U.S. Department of the Treasury’s historical Treasury rates chart displays Treasury bond rates of return in a line graph depicting rate percentage by time period. Users can select long- and short-term bonds, from one... More »

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Forecasting the rate of return of instruments with prices determined on open markets is difficult. It is not possible to calculate future returns or losses precisely. More »

The internal growth rate of a firm is calculated by subtracting its rate of earnings retention from its return on assets, according to Boundless. A company's return on assets is derived from dividing its net income by it... More »

Use the capital asset pricing model to calculate the required rate of return for a stock, as Investopedia explains. Estimate a risk-free rate, determine the stock's market return, and research the stock's beta or calcula... More »

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