ELEMENTARY STATISTICS USING EXCEL
7th Edition
ISBN: 9780136921721
Author: Triola
Publisher: RENT PEARS
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Chapter 10.2, Problem 12BSC
a.
To determine
Find the regression equation with x as the predictor variable (x).
b.
To determine
Find the regression equation with x as the predictor variable using four points in the lower left corner.
c.
To determine
Find the regression equation with x as the predictor variable with four points in the upper right corner.
d.
To determine
Compare the results from parts (a), (b) and (c).
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Problem1
We consider a two-period binomial model with the following properties: each period lastsone (1) year and the current stock price is S0 = 4. On each period, the stock price doubleswhen it moves up and is reduced by half when it moves down. The annual interest rateon the money market is 25%. (This model is the same as in Prob. 1 of HW#2).We consider four options on this market: A European call option with maturity T = 2 years and strike price K = 5; A European put option with maturity T = 2 years and strike price K = 5; An American call option with maturity T = 2 years and strike price K = 5; An American put option with maturity T = 2 years and strike price K = 5.(a) Find the price at time 0 of both European options.(b) Find the price at time 0 of both American options. Compare your results with (a)and comment.(c) For each of the American options, describe the optimal exercising strategy.
Problem 1.We consider a two-period binomial model with the following properties: each period lastsone (1) year and the current stock price is S0 = 4. On each period, the stock price doubleswhen it moves up and is reduced by half when it moves down. The annual interest rateon the money market is 25%.
We consider four options on this market: A European call option with maturity T = 2 years and strike price K = 5; A European put option with maturity T = 2 years and strike price K = 5; An American call option with maturity T = 2 years and strike price K = 5; An American put option with maturity T = 2 years and strike price K = 5.(a) Find the price at time 0 of both European options.(b) Find the price at time 0 of both American options. Compare your results with (a)and comment.(c) For each of the American options, describe the optimal exercising strategy.(d) We assume that you sell the American put to a market participant A for the pricefound in (b). Explain how you act on the market…
What is the standard scores associated to the left of z is 0.1446
Chapter 10 Solutions
ELEMENTARY STATISTICS USING EXCEL
Ch. 10.1 - Prob. 2BSCCh. 10.1 - 3. Global Warming If we find that there is a...Ch. 10.1 - 4. Scatterplots Match these values of r with the...Ch. 10.1 - 5. Bear Weight and Chest Size Fifty-four wild...Ch. 10.2 - Prob. 3BSCCh. 10.2 - 4. Correlation and Slope What is the relationship...Ch. 10.2 - Making Predictions. In Exercises 5–8, let the...Ch. 10.2 - Finding the Equation of the Regression Line. In...Ch. 10.2 - Prob. 10BSCCh. 10.2 - Prob. 11BSC
Ch. 10.2 - Prob. 12BSCCh. 10.3 - Prob. 1BSCCh. 10.3 - 2. Prediction Interval Using the heights and...Ch. 10.3 - Prob. 3BSCCh. 10.3 - Prob. 4BSCCh. 10.3 - Prob. 5BSCCh. 10.3 - Prob. 6BSCCh. 10.3 - Prob. 7BSCCh. 10.3 - Prob. 8BSCCh. 10.3 - Prob. 17BSCCh. 10.3 - Prob. 18BSCCh. 10.3 - Prob. 19BSCCh. 10.3 - Prob. 20BSCCh. 10.3 - Prob. 21BBCh. 10.4 - Prob. 3BSCCh. 10.4 - Prob. 5BSCCh. 10.4 - Prob. 6BSCCh. 10.4 - Prob. 7BSCCh. 10.4 - Prob. 8BSCCh. 10.4 - Appendix B Data Sets. In Exercises 13 – 16, refer...Ch. 10.4 - Prob. 16BSCCh. 10.4 - Prob. 17BBCh. 10.4 - Prob. 18BBCh. 10.4 - Prob. 19BBCh. 10.5 - 1. Identifying a Model and R2 Different samples...Ch. 10.5 - Prob. 2BSCCh. 10.5 - Prob. 7BSCCh. 10.5 - Prob. 8BSCCh. 10.5 - Finding the Best Model. In Exercises 5–16,...Ch. 10.5 - Prob. 11BSCCh. 10.5 - Prob. 14BSCCh. 10.5 - Prob. 16BSCCh. 10.5 - Prob. 18BBCh. 10 - Prob. 3RE
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