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Consider the toss of a (loaded) coin. In a good outcome, punter (bettor) will receive 1 in 12 months. In a bad outcome she will

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Consider the toss of a (loaded) coin. In a "good" outcome, punter (bettor) will receive 1 in 12 months. In a "bad" outcome she will not receive anything. The fair market price of this bet is 0.45 and current prevailing risk-free interest rate is 5%. What is the implied probability of a "good" outcome? Assume discrete compounding. (A) 0.4235 0.4725 (C) 0.5275

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