Monte-Carlo Simulation: Run an MC by simulating 1000 versions of the GBM with the followingparameters;Start Value=100Expected change in each time step (drift): 0% (μ)Volatility (st-dev of random noise): 2% (sigma)Number of Time Steps: 500According to the simulated 1000 scenarios, what is the probability of reaching a value below 100(i.e. the starting value) after 500 steps?According to the simulated 1000 scenarios, what is the probability of reaching a value below 75(i.e. the starting value) after 500 steps?Show with a Python code and the simulation output as a Histogram of values reached at the500th step. (i.e. Histogram of 1000 final values observed in each of the simulated path)

Use this python script:import numpy as np import matplotlib.pyplot as plt # Parameters given for…

Answered: Monte-Carlo Simulation: Run an MC by…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Suppose a computer chip manufacturer know that in a average production run of 2000 circuit boards, 140 will be defective. How many defective circuit boards are expected in a run of 29000 circuit board?
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The following is an excerpt from a conversation between two sales clerks, Tracy Rawlin and Jeff Weimer. Both Tracy and Jeff are employed by Magnum Electronics, a locally owned and operated electronics retail store. Suggest appropriate control procedures that would have prevented or detected the theft of cash.
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No Pain Corp Omar Amman, the CEO of No Pain Corp (NPC), is under stress. They produce transcutaneus electrical nerve simulation units (TENS) for pain control. Amman faces a new opportunity and is not sure how to go about it. Recently, the the Department of Health of Canada has approved low current TENS devices to be sold directly to consumers without a doctor’s note. This will come into effect in three months. In the past, one needed a doctor’s note and could rent the device from some companies. These TENS machines, as they are called in Canada, are popular, since the older population has found them to be effective in pain control with almost no side effects. Amman can sell the device via drug-stores and pharmacies as well as on Amazon. But, Amman is not sure. Amman used to work as a supply chain manager for a power-tool company. Back then, it was a huge logistical “pain,” no pun intended, to work with large retailers and to attend to their fulfilment needs. Those retailers used to…
Reinventing the Wheel at Apex Door Company Jim Delaney, president of Apex Door, has a problem. No matter how often he tells his employees how to do their jobs, they invariably "de- cide to do it their way," as he puts it, and arguments ensue between Jim, the employee, and the employee's supervisor. One example is the door-design department, where the designers are expected to work with the architects to design doors that meet the specifications. While it's not "rocket science," as Jim puts it, the designers invariably make mistakes such as designing in too much steel, a problem that can cost Apex tens of thousands of wasted dollars, once you consider the number of doors in, say, a 30-story office tower. The order processing department is another example. Jim has a very specific and detailed way he wants the order written up, but most of the order clerks don't understand how to use the multipage order form. They simply improvise when it comes to a detailed question such as whether to…
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