Question: There are two possible future states. State 1 , in which the pandemic forces us to go into another lockdown this winter, happens with probability
There are two possible future states. State in which the pandemic forces us to go into another lockdown this winter, happens with probability State in which we continue to progress toward normalcy this winter, happens with probability The following table contains the current prices of Zoom and United as well as their possible prices in the two future states. Assume no arbitrage.
What are the realized returns on Zoom in states and point
What is the expected return on Zoom today hint: compute return in each state and use the probabilities point
What is the price of a security that pays $ in state and $ in state points What is the price of a security that pays $ in state and $ in state points What are the state prices in states and points
Use you answer from part to compute the price of Amazon stock. points
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