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 = 0.011 and σ = 0.048, what is the probability that the price of the share at the end of the 3 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 = 0.011 and σ = 0.048, what is the probability that the price of the share at the end of the 3 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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