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(5 marks) A stock price is observed weekly with Si being the i-th observation. Define di = ln(Si/Si-1). Suppose that there are 40 observations on

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(5 marks) A stock price is observed weekly with Si being the i-th observation. Define di = ln(Si/Si-1). Suppose that there are 40 observations on the u and Eu; = 0.18 while u= 0.06. Estimate the stock price volatility per annum. (Assume that there are 52 weeks per year). (5 marks) A stock price is observed weekly with Si being the i-th observation. Define di = ln(Si/Si-1). Suppose that there are 40 observations on the u and Eu; = 0.18 while u= 0.06. Estimate the stock price volatility per annum. (Assume that there are 52 weeks per year)

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