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Business, 24.07.2020 22:01 ThatTrashPanda

Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,000 or $200,000 with equal probabilities of .5. The alternative risk-free investment in T-bills pays 6% per year. a. If you require a risk premium of 8%, how much will you be willing to pay for the portfolio?

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Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $70,...

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