Risk aversion and required return

Risk aversion and required return

Bachelor of Business Studies (BBS) — Second Year

Subject: Fundamentals of Financial Management (MGT 215)

Unit 4: Fundamentals of Risk and Return

Academic Year: 2083/84

Topic Objectives

After studying this topic, students should be able to:

• Explain the scope and key elements of risk aversion and required return.
• Apply the relevant financial model, calculation or analytical approach and explain its assumptions and decision implications.

Curriculum Scope

• Risk aversion
• Required returns

Detailed Microsyllabus

1. Risk aversion

   1. Preference concerning uncertain outcomes.
   2. Compensation for accepting additional risk.
   3. Differences among decision makers.

2. Required return

   1. Risk-free reference and risk premium.
   2. Relationship between perceived risk and required return.
   3. Use required return as a valuation input with stated assumptions.

---

Curriculum reference: Tribhuvan University, Faculty of Management, revised four-year BBS curriculum, PDF pages 41-43.

Source note: The curriculum scope above is retained from the existing TU syllabus breakdown. The numbered study subtopics are editorial elaborations for teaching and study, rather than a separately issued TU syllabus. Unit or component allocations apply at their stated level; no separate topic hours or marks are assigned here.