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consider a risky portfolio. the ond of the year cash flow derived from the portfolio will be either $ 5 0 0 0 0 with

consider a risky portfolio. the ond of the year cash flow derived from the portfolio will be either $

50000

with probability of

. 6

or $

150000

with probability of

. 4 .

the alternaitve riskless investment in tbill pays

4 % .

this risky portfolio is currently selling for $

80000 .

what is the market risk premium?

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