At a discount brokerage, a stock purchase or sale worth less than $10000 incurs a brokerage fee of 1% of the value of the transaction. A transaction worth more than $10000 incurs a fee of $100 plus 0.5% of the amount exceeding $10000. Note that for a fraction of a cent, the brokerage always charges the customer a full penny. You wish to buy 100 shares of a stock whose price D in dollars has the PMF below. What is the PMF of C, the cost of burying the stock (including the brokerage fee)?

MATLAB: An Introduction with Applications
6th Edition
ISBN:9781119256830
Author:Amos Gilat
Publisher:Amos Gilat
Chapter1: Starting With Matlab
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At a discount brokerage, a stock purchase or sale worth less than $10000 incurs a brokerage fee of 1% of the value of the transaction. A transaction worth more than $10000 incurs a fee of $100 plus 0.5% of the amount exceeding $10000. Note that for a fraction of a cent, the brokerage always charges the customer a full penny. You wish to buy 100 shares of a stock whose price D in dollars has the PMF below. What is the PMF of C, the cost of burying the stock (including the brokerage fee)?

PD(d) =
[1/3 d=99.75, 100, 100.25,
0 otherwise.
Transcribed Image Text:PD(d) = [1/3 d=99.75, 100, 100.25, 0 otherwise.
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