DSE 2010 doubt

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DSE 2010 doubt

Halflife
Screenshot_20170619-191644.png
Q20) Answer : D
Any idea anyone?
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Re: DSE 2010 doubt

AdityaGarg13
For share, present value will be 5(x) + (-1)(1-x) = 3

Which gives x = 2/3 and 1-x = 1/3, probabilities of two states.

Using that third asset price would be 3(x) + 0(1-x) = 3 * 2/3 = 2
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Re: DSE 2010 doubt

Halflife
Thanks.
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