A house and lot costing P2 million was bought at down payment of P500,000. He paid 1 million after 1 year the remaining balance after 3 years. How much was the payment after 3 years, if the interest rate is 24% compounded semi-annually P1,465,971.03 P1,387,214.67 P1,516,210.47 O P1,244,287.44

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Risk and return

Before understanding the concept of Risk and Return in Financial Management, understanding the two-concept Risk and return individually is necessary. 

Capital Asset Pricing Model

Capital asset pricing model, also known as CAPM, shows the relationship between the expected return of the investment and the market at risk. This concept is basically used particularly in the case of stocks or shares. It is also used across finance for pricing assets that have higher risk identity and for evaluating the expected returns for the assets given the risk of those assets and also the cost of capital.