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March 16th, 2012, 10:18 PM  #1 
Newbie Joined: Mar 2012 Posts: 1 Thanks: 0  Black Scholes
I have struggled without luck to solve the question below and will be grateful for any solutions. Consider the BlackScholes world with a stock that follows geometric Brownian motion. A derivative has the following payo? at maturity: Sn T, i.e. the nth power of the stock price at maturity, where n is a known constant. Use the riskneutral valuation method to calculate a pricing formula for this derivative. 

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