Question
Suppose you have invested $1,000 in a stock whose price is increasing at 10 percent a year. Your stock broker, who is never wrong, recommends
Suppose you have invested $1,000 in a stock whose price is increasing at 10 percent a year. Your stock broker, who is never wrong, recommends a stock rising at 20 percent a year. Assuming the broker earns 4 percent of the stock’s value on any purchase or sale of the stock, should you take her recommendation?
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Options Futures and Other Derivatives
Authors: John C. Hull
10th edition
013447208X, 978-0134472089
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