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7. Risk premium Suppose that an investor has a choice between buying a three- year bond with a sace value of S60 and a stock
7. Risk premium Suppose that an investor has a choice between buying a three- year bond with a sace value of S60 and a stock paying a constant dividend of $20 per year, which the investor plans to hold for three years. The real interest rate on the stock and the bond is the same
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