Question: Show that the no-arbitrage time-zero value of a zero coupon bond with maturity t > 0 is 12 e 2 when the risk-neutral instantaneous risk

Show that the no-arbitrage time-zero value of a zero coupon bond

Show that the no-arbitrage time-zero value of a zero coupon bond with maturity t > 0 is 12 e 2 when the risk-neutral instantaneous risk free rate follows r(s) = Z, where Z is a standard normal random variable, and 0

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