Question
A stock trades at $10 today and in one year it will either be $11 or $5. The risk-free rate is 5%. What is the
A stock trades at $10 today and in one year it will either be $11 or $5. The risk-free rate is 5%. What is the risk-neutral implied probability of the stock going to $5 next year?
choose one:
a. 91.7%
b. 8.3%
c. 12.5%
d. 40.0%
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Real Estate Finance And Investments
Authors: William Brueggeman, Jeffrey Fisher
17th Edition
1264072945, 978-1264072941
