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(a) Suppose that V (0) = $100 is invested in a risk free security at time 0. If the value of the investment at time
(a) Suppose that V (0) = $100 is invested in a risk free security at time 0. If the value of the investment at time T becomes V (T ) = $116. Find the return of the investment.
(b) Suppose that $20 is invested in the same security, what is the value of this investment at time T ? How much does the value grow over this time period?
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