Question

The risk-adjusted_____________on capital is the minimum return necessary to attract and retain investment

		normal rate of return
		rate of sales growth
		level of equity
		level of debt

Answer 1

Answer is normal rate of return.

The risk-adjusted normal rate of return on capital is the minimum return necessary to attract and retain investment.

The normal rate of return on capital is the cost of an investment. so it is the minimum return at which cash flows from investment will be equal to cost of investment i.e. investment will have no profit or no loss. return above the risk-adjusted normal rate of return on capital will generate profits.

rest all options are not a return necessary for an investment.