The table here shows the no-arbitrage prices of securities A and B that we calculated. a. What

Question:

The table here shows the no-arbitrage prices of securities A and B that we calculated.

a. What are the payoffs of a portfolio of one share of security A and one share of security B?
b. What is the market price of this portfolio? What expected return will you earn from holding thisportfolio?

Expected Return
The expected return is the profit or loss an investor anticipates on an investment that has known or anticipated rates of return (RoR). It is calculated by multiplying potential outcomes by the chances of them occurring and then totaling these... Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...