Question: Exercise 5.7.3 (1) Prove that E 1 { 1+ S(1) }{ 1+ S(1, 2) } { 1+ S(n1, n) }

Exercise 5.7.3 (1) Prove that E



1

{ 1+ S(1) }{ 1+ S(1, 2) } · · · { 1+ S(n−1, n) }



= 1

[ 1+ S(n) ]n under the local expectations theory. (2) Show that the local expectations theory is inconsistent with the unbiased expectations theory.

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