The Impact of the Degrees of Operating and Financial Leverage on Systematic Risk of Common Stock

Gershon Mandelker () and S. Ghon Rhee

Journal of Financial and Quantitative Analysis, 1984, vol. 19, issue 1, 45-57

Abstract: The capital asset pricing model postulates that the equilibrium return on any risky security is equal to the sum of the risk-free rate of return and a risk premium measured by the product of the market price of risk and the security's systematic risk. In the capital asset pricing model, beta as an index of systematic risk is the only security-specific parameter that affects the equilibrium return on a risky security.

Date: 1984
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