« previous next »

Author Question: How does arbitrage help the Law of One Price? (Read 71 times)

JMatthes

  • Hero Member
  • *****
  • Posts: 578
on: Jul 9, 2019
How does arbitrage help the Law of One Price?
Fundamentals of Corporate Finance ¦ Berk, DeMarzo, Harford ¦ 2nd Edition
Buy Test-Bank


Eazy416

  • Sr. Member
  • ****
  • Posts: 360
Reply #1 on: Jul 9, 2019
Any arbitrage opportunity will exploit any mispricing to restore the Law of One Price.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question

JMatthes

  • Hero Member
  • *****
  • Posts: 578
Reply #2 on: Jul 9, 2019
TY


Eazy416

  • Sr. Member
  • ****
  • Posts: 360
Reply #3 on: Jul 9, 2019
You're welcome


« previous next »
 

Did you know?

Though “Krazy Glue” or “Super Glue” has the ability to seal small wounds, it is not recommended for this purpose since it contains many substances that should not enter the body through the skin, and may be harmful.

Did you know?

Though the United States has largely rejected the metric system, it is used for currency, as in 100 pennies = 1 dollar. Previously, the British currency system was used, with measurements such as 12 pence to the shilling, and 20 shillings to the pound.

Did you know?

The human body's pharmacokinetics are quite varied. Our hair holds onto drugs longer than our urine, blood, or saliva. For example, alcohol can be detected in the hair for up to 90 days after it was consumed. The same is true for marijuana, cocaine, ecstasy, heroin, methamphetamine, and nicotine.

Did you know?

Many of the drugs used by neuroscientists are derived from toxic plants and venomous animals (such as snakes, spiders, snails, and puffer fish).

Did you know?

Signs and symptoms that may signify an eye tumor include general blurred vision, bulging eye(s), double vision, a sensation of a foreign body in the eye(s), iris defects, limited ability to move the eyelid(s), limited ability to move the eye(s), pain or discomfort in or around the eyes or eyelids, red or pink eyes, white or cloud spots on the eye(s), colored spots on the eyelid(s), swelling around the eyes, swollen eyelid(s), and general vision loss.

Wheat and Cotton Prices and Consumer Price Indexes, 1865–1896 Wheat and Cotton Prices and Consumer Price Indexes, 1865–1896
How to create a price index to calculate inflation for a basket of goods How to create a price index to calculate inflation for a basket of goods
The profit, p(t), made at a fair depends on the price of the ticket, t. The profit is modelled ... The profit, p(t), made at a fair depends on the price of the ticket, t. The profit is modelled ...
Your company advertises all prices on the menu board as a final price, including HST of 13%. A ... Your company advertises all prices on the menu board as a final price, including HST of 13%. A ...
"The Department of Agriculture came out today with its prediction for food price "The Department of Agriculture came out today with its prediction for food price
Refer to Scenario 3.1. If the price of potato chips is $0.50 and the price of Cola is $4.00, ... Refer to Scenario 3.1. If the price of potato chips is $0.50 and the price of Cola is $4.00, ...
Video: The 4 steps of translation Animation

For a complete list of videos, visit our video library