Starting at some fixed time, let F(n) denotes the price of a First Local Bank share at the end of n additional weeks, n ≥ 1; and let the evolution of these prices assumes that the price ratios F(n)/F(n − 1) for n ≥ 1 are independent and identically distributed lognormal random variables. Assuming this model, with lognormal parameters µ = 0.012 and σ = 0.048, what is the probability that the price of the share at the end of the four weeks is higher than it is today?

Starting at some fixed time, let F(n) denotes the price of a First Local Bank share at the end of n additional weeks, n ≥ 1; and let the evolution of these prices assumes that the price ratios F(n)/F(n − 1) for n ≥ 1 are independent and identically distributed lognormal random variables. Assuming this model, with lognormal parameters µ = 0.012 and σ = 0.048, what is the probability that the price of the share at the end of the four weeks is higher than it is today?

A First Course in Probability (10th Edition)

10th Edition

ISBN:9780134753119

Author:Sheldon Ross

Publisher:Sheldon Ross

Chapter1: Combinatorial Analysis

Section: Chapter Questions

Problem 1.1P: a. How many different 7-place license plates are possible if the first 2 places are for letters and...

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