principles of financial economics leroy and werne phần 2 pps

...  2 . The inner product of two vectors x and y is given by x ·y = (x 1  1 + x 2  2 ) ·(y 1  1 + y 2  2 ). (17 .20 ) Since  1 and  2 are orthonormal, we have x ·y = x 1 y 1 + x 2 y 2 , (17 .21 ) so ... KERNELS and  y 1  2 =  x Z 1 − x Z 2  2 +  y 2  2 . (17.15) Eqs. 17.14 and 17.15 imply that  x Z 1 − x Z 2  2 = 0 (17.16) so, by the strict...

... implies that h 2 (ξ g ) ≥ 2, h 2 (ξ g ) ≥ 1, h 2 (ξ b ) ≥ 1, h 2 (ξ b ) ≥ 0, (24 .8) h 1 (ξ 0 ) + 0.9(h 2 (ξ 0 ) −h 2 (ξ g )) ≥ 0, and h 1 (ξ 0 ) + 0.8(h 2 (ξ 0 ) −h 2 (ξ b )) ≥ 0. (24 .9) The solution ... positive and nonzero payoff, and (2) utility functions are strictly increasing at any date at which that payoff is nonzero. 21 9 22 0 CHAPTER 22 . MULTIDATE ARBITRAG...