# Question: Suppose S 0 100 r 0 06 S 0 4

Suppose S(0) = $100, r = 0.06, σS = 0.4, and δ = 0. Use equation (20.32) to compute prices for claims that pay the following:

a. S2

b.√S

c. S−2

Compare your answers to the answers you obtained to Problem 19.6.

a. S2

b.√S

c. S−2

Compare your answers to the answers you obtained to Problem 19.6.

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