问题如下：
7. A potential weakness of Johansson’s approach to estimating the required return on equity for Twin Industries is that the return estimate:
选项：
A.does not include a size premium.
B.may overstate potential returns over the long-term.
C.does not consider systematic risk arising from the economics of the industry.
解释：
A is correct.
Johansson intends to estimate a required return on equity using a modified CAPM approach. Twin Industries is stated to be smaller than the chosen proxy benchmark being used and there is no size premium adjustment in the CAPM framework; the framework adjusts the beta for leverage differences but this does not adjust for firm size differences. The build-up method may be more appropriate as it includes the equity risk premium and one or more additional premia, often based on factors such as size and perceived company-specific risk.
老师你好 ，题干中说的是”Johansson’s approach“，那他都是求beta的，给我的感觉就是CAPM approach;
即便是私人企业，又怎么判断到build-up approach上去呢，怎么样避过“求beta，用capm”这个坑呢？
