Question: Game: Game 1 Game 2 Probability Outcome Probability Outcome 0.1 $5M 0.89 $1M 1.0 $1M 0.01 $0 Suppose that the game is to be played

Game:

Game 1		Game 2
Probability	Outcome	Probability	Outcome
0.1	$5M
0.89	$1M	1.0	$1M
0.01	$0

Suppose that the game is to be played six months from today. If you purchased 1,000 games and sold 20,000 securities on it, what would be the price of each security? Make this computation for both games. Note, the risk-free rate is 2.5%. Explain this process and how it contributes to capital market efficiency, and in particular, liquidity.

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