Problem on the risk free arbitrage

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Qusetion: Risk free arbitrage is important to all areas of finance and particularly capital budgeting? Most activities in reality that are called "arbitrage" are actually "risky arbitrage" such as the simultaneous selling of an acquiring company's stock and the buying of a target company's after an announced merger or acquisition. Please give an example of arbitrage in finance and comment on the inherent or underlying risk.

Reference no: EM131798156

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