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Posted on Sep 10, 2024

A riskless security costs $ 2 , 8 8 1 and will pay $ 3 , 1 0 0 in one year. a . What

A riskless security costs $

2, 881

and will pay $

3, 100

in one year.

.

What is the risk

-

free interest rate in the absence of any arbitrage opportunity?

.

What is the risk

-

free interest rate if the security pays $

20, 000

10

years?

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