Question: is this statement TRUE or FALSE ? A stock with price 100 kr follows a one step Binomial model and will either increase invalue to
is this statement TRUE or FALSE ?
A stock with price 100 kr follows a one step Binomial model and will either increase invalue to 120 kr or decrease to 90 kr in one years time. The risk free interest rate is zero.An investor consider the increase and decrease in this model to be equally likely to happen.Is it true or false that the investor is risk-averse?
is this statement TRUE or FALSE ?
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
