Profits at a securities firm are determined by the volume of securities sold, and this volume fluctuates from week to week. If volume is high this week, then next week it will be high with a probability of 0.7 and low with a probability of 0.3. If volume is low this week then it will be high next week with a probability of 0.1. 1. Find the transition matrix for the Markov chain, with high volume being state 1 and low volume state 2. ... ... ... ..- 2. If the volume was low last week, what is the probability the volume will be low this week? 3. If the volume was high this week, what is the probability it will be low three weeks from now? ...

Profits at a securities firm are determined by the volume of securities sold, and this volume fluctuates from week to week. If volume is high this week, then next week it will be high with a probability of 0.7 and low with a probability of 0.3. If volume is low this week then it will be high next week with a probability of 0.1. 1. Find the transition matrix for the Markov chain, with high volume being state 1 and low volume state 2. ... ... ... ..- 2. If the volume was low last week, what is the probability the volume will be low this week? 3. If the volume was high this week, what is the probability it will be low three weeks from now? ...

Name: Profits at a securities firm are determined by thevolume of securitie
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Description: Profits at a securities firm are determined by thevolume of securities sold, and this volumefluctuates from week to week. If volume is highthis week, then next week it will be high with aprobability of 0.7 and low with a probability of0.3. If volume

MATLAB: An Introduction with Applications

6th Edition

ISBN:9781119256830

Author:Amos Gilat

Publisher:Amos Gilat

Chapter1: Starting With Matlab

Section: Chapter Questions

Problem 1P

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(i) If volume is high this week, then next week it will be high with a probability of 0.8 and low with a probability of 0.2. (ii) If volume is low this week then it will be high next week with a probability of 0.2. Assume that state 1 is high volume and that state 2 is low volume. (1) Find the transition matrix for this Markov process. ... P = ... ... ... (2) If the volume this week is high, what is the probability that the volume will be high two weeks from now? (3) What is the probability that volume will be high for three consecutive weeks? ...
(i) If volume is high this week, then next week it will be high with a probability of 0.6 and low with a probability of 0.4. (ii) If volume is low this week then it will be high next week with a probability of 0.1. Assume that state 1 is high volume and that state 2 is low volume (1) Find the transition matrix for this Markov process. (2) If the volume this week is high, what is the probability that the volume will be high two weeks from now? (3) What is the probability that volume will be high for three consecutive weeks?
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