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There are two periods: 0 and 1. There is a security which will pay a single dividend at date 1. The dividend may be equal
There are two periods: 0 and 1. There is a security which will pay a single dividend at date 1. The dividend may be equal to $50 or $25 or $0 with equal probabilities. Suppose the investor is risk-neutral with money. The investor has to decide whether to buy the security at date O or not, but will pay for the security at period 1. What is the highest price the risk-neutral investor would pay
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