The process for the stock price in equation (11.8) is SS = fiS St where /x and
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The process for the stock price in equation (11.8) is SS = fiS St where /x and a are constant. Explain carefully the difference between this model and each of the following:
SS = fi St + aeVsi SS = fiS St SS = (i St Why is the model in equation (11.8) a more appropriate model of stock price behavior than any of these three alternatives?
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