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Please make answer clear and simple Question 2: (4 points) If you construct a hedged portfolio that provides a payoff of $100 thousand in one

image text in transcribedPlease make answer clear and simple

Question 2: (4 points) If you construct a hedged portfolio that provides a payoff of $100 thousand in one year irrespective of the economic conditions in the market, what is the discount rate that you are going to use to find the present value of the payoff? Give reasons for your selection of the discount rate

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