2) There are four possible states of the world: 1, 2, 3, and 4, with corresponding stateclaims: S1, S2, S3, and S4. Three assets are available with asset prices (in dollars) andpayoffs (in "corn") in the four states given below:A1: price-$24 payoffs: (1, 2, 3, 4)A2: price=$13 payoffs: (0, 1, 2, 3)A3: price = $12 payoffs: (0, 0, 2, 4)No other assets are available.A) Find a portfolio that replicates the state claim S1 with payoff (1, 0, 0, 0)B) What is the price of that state claim?C) Explain why at least one of S2, S3, and/or S4 cannot be replicated with these assets.

A) Find a portfolio that replicates the state claim S1S1S1 with payoff (1,0,0,0)We are given the…

Answered: 2) There are four possible states of…

Linear Algebra: A Modern Introduction

4th Edition

ISBN:9781285463247

Author:David Poole

Publisher:David Poole

Chapter2: Systems Of Linear Equations

Section2.4: Applications

Problem 28EQ

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i.3
Lynbrook West, an apartment complex financed by the State Housing Finance Agency, consists of one-, two-, three- and four-bedroom units. The rental rate for each type of unit—low, moderate, or market—is determined by the income of the tenant. How many different rates are there? different rates
a. Suppose that Odysseas Estate Ltd buys an office building (4,200 sg.m.) and rents 95% of it to 8 different companies. How many and which Real Estate Markets are involved in this transaction? Explain, in your own words, how capitalization rates, prices and rents are determined in these markets. Give your answer verbally and diagrammatically.
The Deinell-Forging-Corporation manufactures four highly confidential products that it supplies to ammunition firms that hold RSA government contracts. Each product must pass through the following departments before being shipped: forging, cleaning, weighing, and inspection. The time requirement in hours for each unit and its corresponding profit value are summarised in the following table: Department Product Forging Cleaning Weighing Inspection |хм122 Unit profit (Rand) 0.6 0.3 0.3 0.5 11000 XJ312 1.5 4 2. 14000 RM122 RM126 1.5 2. 1. 0.5 17000 1. 1.5 13000 Monthly available production in each department and the minimum monthly production requirement to fulfil these contracts are: Сараcity Departme (hours) Product Minimum production level Forging Cleaning Weighing Inspectior 10000 RM126 13000 XM122 130 15000 XJ312 80 24000 RM122 260 320 The production manager needs to specify production levels for each product for the next month. Formulate this problem to help him maximise the total…
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I need help with part B-1 of this question.
A company manufactures three types of lamps, labeled A, B, and C. Each lamp is processed in two departments, I and II. Total available work-hours per day for departments I and II are 409 and 591, respectively. No additional labor is available. Time requirements and profit per unit for each lamp type are shown in the table to the right. The company has assigned you as the accounting member of its profit planning committee to determine the numbers of types of A, B, and C lamps that it should produce in order to maximize its total profit from the sale of lamps. The following questions relate to a linear programming model that your group has developed. a. What would the coefficients of the objective function be? OA. 2, 3, 1 OB. 409, 591 OC. 8, 7, 6 OD. 4, 2, 3 b. What would the constraints in the model be? OA. 4, 2, 3 OB. 2, 3, 1 OC. 8, 7, 6 OD. 409, 591 c. What could the constraint imposed by the available work-hours in department I be expressed as? OA. 4x₁ + 2x₂ + 3x3 ≤ 409 O B. 2x₁ +…
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The following lots of a Commodity P were available for sale during the year. Beginning inventory 5 units at $61 First purchase 15 units at $63 Second purchase 10 units at $74 Third purchase 10 units at $77 The firm uses the periodic system, and there are 20 units of the commodity on hand at the end of the year. What is the year-end inventory balance using the FIFO method? a. $1,375 b. $1,380 c. $1,250 d. $1,510
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You’re a logistics engineer for a manufacturer of hard seltzer. You use three different shippingcompanies (?1, ?2, ?3) to distribute seltzers. You contract with ?1 50% of the time, ?2 40% ofthe time, and ?3 10% of the time. Of those sent by ?1, 2% arrive after the guaranteed deliverytime (late delivery). Similarly, 1% of those handled by ?2 arrive late, and 5% of shipments by ?3arrive late.a. What is the probability that a randomly selected shipment arrived late?b. What is the probability that a randomly selected shipment was sent via ?1 and was late?c. If a randomly selected shipment arrived on time, what is the probability that it was notsent via ?1?
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