COMPOUNDING RISK OVER TIME: A NOTE
指出，投资评估中常用的风险调整贴现率法仅适用于风险随时间增加的项目，但“风险溢价复利”证明存在混淆投资水平与收益率的缺陷。
The widely used risk‐adjusted discount rate technique of investment evaluation has long been believed to be strictly appropriate only for projects whose risk increased with time. The “certainty equivalent proof” of that belief has recently been refuted. This paper attempts to demonstrate that the other proof of that belief, called the “compounding the risk premium” approach, is also flawed since it confuses the level of investment and the rate earned on investment.