RDP 8707: Asymmetric Information and Bid-Ask Spreads in the Eurocurrency Markets Equation

( ii ) dσ d σ ∈ 2 − 1 2 [ σ ∈ 2 +c ] − 1 2 − 1 2σ Thus  dk d σ ∈ 2 − cg( h ) σ 3 [ 1 1−Rg′( h ) ]+ h 2σ >0 since R<1 g′( h )<1. MathType@MTEF@5@5@+=feaagCart1ev2aaatCvAUfeBSjuyZL2yd9gzLbvyNv2CaerbuLwBLnhiov2DGi1BTfMBaeXatLxBI9gBaerbd9wDYLwzYbItLDharqqtubsr4rNCHbGeaGqiVu0Je9sqqrpepC0xbbL8F4rqqrFfpeea0xe9Lq=Jc9vqaqpepm0xbba9pwe9Q8fs0=yqaqpepae9pg0FirpepeKkFr0xfr=xfr=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jdiIoaabmaabaGaaeiAaaGaayjkaiaawMcaaaaaaiaawUfacaGLDbaacqGHRaWkdaWcaaqaaiaabIgaaeaacaaIYaGaeq4Wdmhaaiabg6da+iaaicdaaeaaaeaacaqGZbGaaeyAaiaab6gacaqGJbGaaeyzaiaaykW7caqGsbGaeyipaWJaaGymaaqaaaqaaiaabEgacqWFYaIOdaqadaqaaiaabIgaaiaawIcacaGLPaaacqGH8aapcaaIXaGaaiOlaaaaaaa@8E49@