Question
Suppose there are S different states of the world and there are S distinct Arrow securities. The payoff of the risk free bond is r
Suppose there are S different states of the world and there are S distinct Arrow securities. The payoff of the risk free bond is r in each state of the world. The price of a portfolio that consists of one unit of each Arrow security is a) 1+ r
b) (1+r) * S c) indefinite because information is missing
d) 1/r
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Fundamentals of Managerial Economics
Authors: Mark Hirschey
9th edition
324584830, 978-0324588781, 032458878X, 978-0324584837
