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Suppose U(w) = ln(w) and the initial wealth is w0. There is a 50% chance of winning or losing some amount of wealth h. Find
Suppose U(w) = ln(w) and the initial wealth is w0. There is a 50% chance of winning or losing some amount of wealth h. Find the certainty equivalent and risk premium
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Financial Theory and Corporate Policy
Authors: Thomas E. Copeland, J. Fred Weston, Kuldeep Shastri
4th edition
321127218, 978-0321179548, 321179544, 978-0321127211
