Question: which one is true which one is false,why? If the return is riskless and never deviates from its mean, the variance is equal to one.

which one is true which one is false,why?

If the return is riskless and never deviates from its mean, the variance is equal to one.

If the current stock price were greater than P0 = , it would be a positive NPV investment, and we would expect investors to rush in and buy it, driving up the stocks price.

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