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consider a risky portfolio. the end of year cash flow serived from the perpfolio will be 50k with probability of 0.6 or $100k witb probability
consider a risky portfolio. the end of year cash flow serived from the perpfolio will be 50k with probability of 0.6 or $100k witb probability if 0.4. the alternative risk free investment in t bills is 2%. if you require a risk premium of 8% hiw much will you be willing to pay for portoflio?
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