Question
You want to buy lottery ticket because youre feeling lucky. The ticket price is $10. With a probability of 1/100, you get $900, and with
You want to buy lottery ticket because youre feeling lucky. The ticket price is $10. With a probability of 1/100, you get $900, and with probability of 99/100, you get nothing.
a. You decide to buy 1 ticket, what are your expected return and the standard deviation of this return?
b. You decide to buy 100 ticket, what are your expected return and the standard deviation of this return?
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Risk Management And Financial Institutions
Authors: John C. Hull
3rd Edition
1118269039, 9781118269039
