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10. After one year, the economy can be in one of the three scenarios: good, bad, ugly. There are four assets, A, B, C, and
10. After one year, the economy can be in one of the three scenarios: good, bad, ugly. There are four assets, A, B, C, and D, whose value cash flow in the three states will be as follows: Good Bad Ugly $10 $5 $0 $10 $4 The prices of the assets A, B, and C, are $5, $4.60, and $4.59, respectively. a. What are the state prices of the three scenarios? b. What is the risk-free rate? c. What is the price of asset D
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