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Question: 10 after one year the economy can be in one...

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10. After one year, the economy can be in one of the three scenarios: good, bad, ugly. There are four assets, A, B, C, and D, whose value (cash flow) in the three states will be as follows: Good $10 $0 $7 $5 $5 $5 $4 $0 Ugly $0 $10 $4 $5 The prices of the assets A, B, and C, are $5, $4.60, and $4.59, respectively a. What are the state prices of the three scenarios? b. What is the risk-free rate? c. What is the price of asset D?

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