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The following question is based on Campbell, John Y. and Robert J. Shiller, Valuation Ratios and the Long-Run Stock Market Outlook: An Update NBER Working

The following question is based on Campbell, John Y. and Robert J. Shiller, Valuation Ratios and the Long-Run Stock Market Outlook: An Update NBER Working Paper No. 8221, April 2001. It is well-known that dividend-price ratio, D/P is mean-reverting.

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