Discrete Mathematics and Its Applications ( 8th International Edition ) ISBN:9781260091991
8th Edition
ISBN: 9781259676512
Author: Kenneth H Rosen
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 2, Problem 2WP
Research where the concept of a function first arose, and describe how this concept was first used.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Question 2. An American option on a stock has payoff given by F = f(St) when it is exercised
at time t. We know that the function f is convex. A person claims that because of convexity,
it is optimal to exercise at expiration T. Do you agree with them?
Question 4. We consider a CRR model with So == 5 and up and down factors u = 1.03 and
d = 0.96. We consider the interest rate r = 4% (over one period). Is this a suitable CRR
model? (Explain your answer.)
Question 3. We want to price a put option with strike price K and expiration T. Two financial
advisors estimate the parameters with two different statistical methods: they obtain the same
return rate μ, the same volatility σ, but the first advisor has interest r₁ and the second advisor
has interest rate r2 (r1>r2). They both use a CRR model with the same number of periods to
price the option. Which advisor will get the larger price? (Explain your answer.)
Chapter 2 Solutions
Discrete Mathematics and Its Applications ( 8th International Edition ) ISBN:9781260091991
Ch. 2.1 - List the members of these sets. { xx is a real...Ch. 2.1 - Use set builder notation to give a description of...Ch. 2.1 - Which of the intervals (0, 5), (0, 5], [0, 5), [0,...Ch. 2.1 - For each of these intervals, list all its elements...Ch. 2.1 - For each of these pairs of sets, determine whether...Ch. 2.1 - For each of these pairs of sets, determine whether...Ch. 2.1 - Prob. 7ECh. 2.1 - Prob. 8ECh. 2.1 - For each of the following sets, determine whether...Ch. 2.1 - Prob. 10E
Ch. 2.1 - Determine whether each of these statements is true...Ch. 2.1 - Determine whether these statements are true or...Ch. 2.1 - Determine whether each of these statements is true...Ch. 2.1 - Prob. 14ECh. 2.1 - Use a Venn diagram to illustrate the set of all...Ch. 2.1 - Prob. 16ECh. 2.1 - Use a Venn diagram to illustrate the re1ationships...Ch. 2.1 - Use a Venn diagram to illustrate the relationships...Ch. 2.1 - Prob. 19ECh. 2.1 - Prob. 20ECh. 2.1 - What is the cardinality of each of these sets? {a}...Ch. 2.1 - What is the cardinality of each of these sets? {}...Ch. 2.1 - Prob. 23ECh. 2.1 - Prob. 24ECh. 2.1 - How many elements does each of these sets have...Ch. 2.1 - Determine whether each of these sets is the power...Ch. 2.1 - Prove that P(A)P(B) if and only if AB .Ch. 2.1 - Show that if AC and BD , then ABCDCh. 2.1 - Let A={a,b,c,d} and B={y,z} . Find AB . BA .Ch. 2.1 - Prob. 30ECh. 2.1 - That is the Cartesian product ABC , where A is the...Ch. 2.1 - Prob. 32ECh. 2.1 - Prob. 33ECh. 2.1 - Let A={a,b,c} , B={x,y} , and C={0,l} . Find ABC ....Ch. 2.1 - Find A2 if A={0,1,3} A={1,2,a,b}Ch. 2.1 - Find A3 if A={a} A={0,a}Ch. 2.1 - How many different elements does AB have if A has...Ch. 2.1 - How many different elements does ABC have if A has...Ch. 2.1 - How many different elements does An have when A...Ch. 2.1 - Show that ABBA , when A and B are nonempty, unless...Ch. 2.1 - Explain why ABC and (AB)C are not the same.Ch. 2.1 - Explain why (AB)(CD) and A(BC)D are not the same.Ch. 2.1 - Prove or disprove that if A and B are sets, then...Ch. 2.1 - Prove or disprove that if A, B, and C are nonempty...Ch. 2.1 - Translate each of these quantifications into...Ch. 2.1 - Translate each of these quantifications into...Ch. 2.1 - Find the truth set of each of these predicates...Ch. 2.1 - Find the truth set of each of these predicates...Ch. 2.1 - Prob. 49ECh. 2.1 - Prob. 50ECh. 2.1 - Prob. 51ECh. 2.2 - Prob. 1ECh. 2.2 - Suppose that A is the set of sophomores at your...Ch. 2.2 - Let A={1,2,3,4,5} and B={0,3,6} . Find AB . AB ....Ch. 2.2 - Let A={a,b,c,d,e} and B={a,b,c,d,e,f,g,h} . Find...Ch. 2.2 - Prob. 5ECh. 2.2 - Prob. 6ECh. 2.2 - Prob. 7ECh. 2.2 - Prob. 8ECh. 2.2 - Prob. 9ECh. 2.2 - Prob. 10ECh. 2.2 - Prob. 11ECh. 2.2 - Prob. 12ECh. 2.2 - TABLE 1 Set Identities. Identity Name AU=AA=A...Ch. 2.2 - Prob. 14ECh. 2.2 - Prob. 15ECh. 2.2 - Prob. 16ECh. 2.2 - Show that if A and B are sets in a universe U then...Ch. 2.2 - Prob. 18ECh. 2.2 - Prob. 19ECh. 2.2 - Prob. 20ECh. 2.2 - Prob. 21ECh. 2.2 - Prob. 22ECh. 2.2 - Prob. 23ECh. 2.2 - Prob. 24ECh. 2.2 - Prob. 25ECh. 2.2 - Let A, B, and C be sets. Show that (AB)C=(AC)(BC)...Ch. 2.2 - Prob. 27ECh. 2.2 - Prob. 28ECh. 2.2 - Prob. 29ECh. 2.2 - Prob. 30ECh. 2.2 - Prob. 31ECh. 2.2 - Prob. 32ECh. 2.2 - Let A and B be subsets of a universal set U. Show...Ch. 2.2 - Let A, B, and C be sets. Use the identity AB=AB ,...Ch. 2.2 - Prob. 35ECh. 2.2 - Prob. 36ECh. 2.2 - Prove or disprove that for all sets A, B, and C,...Ch. 2.2 - Prob. 38ECh. 2.2 - Prob. 39ECh. 2.2 - Prob. 40ECh. 2.2 - Prob. 41ECh. 2.2 - Prob. 42ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 44ECh. 2.2 - Prob. 45ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 47ECh. 2.2 - Prob. 48ECh. 2.2 - Prob. 49ECh. 2.2 - Prob. 50ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 52ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 54ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 58ECh. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - The symmetric difference of A and B, denoted by AB...Ch. 2.2 - Prob. 64ECh. 2.2 - Prob. 65ECh. 2.2 - Prob. 66ECh. 2.2 - Prob. 67ECh. 2.2 - Prob. 68ECh. 2.2 - Prob. 69ECh. 2.2 - The successor of the set A is the set A{A} ....Ch. 2.2 - The Jaccard similarity J(A,B) of the finite sets A...Ch. 2.2 - Prob. 72ECh. 2.2 - Prob. 73ECh. 2.2 - Prob. 74ECh. 2.2 - Prob. 75ECh. 2.3 - Why is f not a function from R to R if f(x)=1/x?...Ch. 2.3 - Determine whether f is a function from Z to R if...Ch. 2.3 - Prob. 3ECh. 2.3 - Find the domain and range of these functions. Note...Ch. 2.3 - Find the domain and range of these functions. Note...Ch. 2.3 - Find the domain and range of these functions. the...Ch. 2.3 - Find the domain and range of these functions. the...Ch. 2.3 - Find these values. 1.1 1.1 0.1 0.1 2.99 2.99 12+12...Ch. 2.3 - Find these values. 34 78 34 78 3 1 12+32 1252Ch. 2.3 - Prob. 10ECh. 2.3 - Which functions in Exercise 10 are onto? Determine...Ch. 2.3 - Determine whether each of these functions from Z...Ch. 2.3 - Prob. 13ECh. 2.3 - Determine whether f:ZZZ is onto if f(m,n)=2mn ....Ch. 2.3 - Determine whether the function f:ZZZ is onto if...Ch. 2.3 - Consider these functions from the set of students...Ch. 2.3 - Consider these functions from the set of teachers...Ch. 2.3 - Specify a codomain for each of the functions in...Ch. 2.3 - Specify a codomain for each of the functions in...Ch. 2.3 - Prob. 20ECh. 2.3 - Give an explicit formula for a function from the...Ch. 2.3 - Determine whether each of these functions is a...Ch. 2.3 - Determine whether each of these functions is a...Ch. 2.3 - Let f:RR and let f(x)0 for all xR . Show that f(x)...Ch. 2.3 - Let f:RR and 1et f(x)0 for all xR . Show that f(x)...Ch. 2.3 - Prove that a strictly increasing function from R...Ch. 2.3 - Prob. 27ECh. 2.3 - Show that the function f(x)=ex from the set of...Ch. 2.3 - Prob. 29ECh. 2.3 - Let S={1,0,2,4,7} . Find f(S) if f(x)=1 ....Ch. 2.3 - Let f(x)=x2/3 . Find f(S) if S={2,1,0,1,2,3}...Ch. 2.3 - Let f(x)=2x where the domain is the set of real...Ch. 2.3 - Prob. 33ECh. 2.3 - Suppose that g is a function from A to B and f is...Ch. 2.3 - Prob. 35ECh. 2.3 - If f and fog are one-to-one, does it follow that g...Ch. 2.3 - Prob. 37ECh. 2.3 - Find fog and gof where f(x)=x2 and g(x)=x+2 , are...Ch. 2.3 - Prob. 39ECh. 2.3 - Let f(x)ax+b and g(x)=cx+d , where a, b, c, and d...Ch. 2.3 - Show that the function f(x)ax+b from R to R, where...Ch. 2.3 - Prob. 42ECh. 2.3 - Prob. 43ECh. 2.3 - Let f be the function from R to R defined by...Ch. 2.3 - Let g(x)=|x| . Find g1({0}) . g1({1,0,1}) ....Ch. 2.3 - Prob. 46ECh. 2.3 - Prob. 47ECh. 2.3 - Show x+12 is the closest integer to the number x...Ch. 2.3 - Prob. 49ECh. 2.3 - Show that if x is a real number, then xx=1 if x is...Ch. 2.3 - Prob. 51ECh. 2.3 - Prob. 52ECh. 2.3 - Prob. 53ECh. 2.3 - Show that if x is a real number and n is an...Ch. 2.3 - Prob. 55ECh. 2.3 - Prove that if x is a real number, then x=x and x=x...Ch. 2.3 - Prob. 57ECh. 2.3 - Prob. 58ECh. 2.3 - Prob. 59ECh. 2.3 - How many bytes are required to encode n bits of...Ch. 2.3 - How many bytes are required to encode n bits of...Ch. 2.3 - How many ATM cells (described in Example 30) can...Ch. 2.3 - Data are transmitted over a particular Ethernet...Ch. 2.3 - Draw the graph of the function f(n)=1n2 from Z to...Ch. 2.3 - Draw the graph of the function f(x)=2x from R to...Ch. 2.3 - Draw the graph of the function f(x)=x/2 from R to...Ch. 2.3 - Prob. 67ECh. 2.3 - Draw the graph of the function f(x)=x+x/2 from R...Ch. 2.3 - Draw graphs of each of these functions. f(x)=x+12...Ch. 2.3 - Prob. 70ECh. 2.3 - Find the inverse function of f(x)=x3+1 .Ch. 2.3 - Suppose that f is an invertible function from Y to...Ch. 2.3 - Let S be a subset of a universal set U. The...Ch. 2.3 - Suppose that f is a function from A to B, where A...Ch. 2.3 - Prove or disprove each of these statements about...Ch. 2.3 - Prove or disprove each of these statements about...Ch. 2.3 - Prove that if x is a positive real number, then...Ch. 2.3 - Let x be a real number. Show that 3x=x+x+13+x+23 .Ch. 2.3 - For each of these partial functions, determine its...Ch. 2.3 - Prob. 80ECh. 2.3 - Prob. 81ECh. 2.3 - Show that a set S is infinite if and only if there...Ch. 2.4 - Find these terms of the sequence {an} , where...Ch. 2.4 - What is the term a8 of the sequence {an} if an ,...Ch. 2.4 - What are the terms a0,a1,a2 , and a3 of the...Ch. 2.4 - What are the terms a0,a1,a2 , and a3 of the...Ch. 2.4 - List the first 10 terms of each of these...Ch. 2.4 - List the first lo terms of each of these...Ch. 2.4 - Find at least three different sequences beginning...Ch. 2.4 - Find at least three different sequences beginning...Ch. 2.4 - Find the first five terms of the sequence defined...Ch. 2.4 - Find the first six terms of the sequence defined...Ch. 2.4 - Let an=2n+53n for n=0,1,2,,... Find a0,a1,a2,a3 ,...Ch. 2.4 - Show that the sequence {an} is a solution of the...Ch. 2.4 - Is the sequence {an} a solution of the recurrence...Ch. 2.4 - For each of these sequences find a recurrence...Ch. 2.4 - Show that the sequence {an} is a solution of the...Ch. 2.4 - Find the solution to each of these recurrence...Ch. 2.4 - Find the solution to each of these recurrence...Ch. 2.4 - A person deposits $1000 in an account that yields...Ch. 2.4 - Suppose that the number of bacteria in a colony...Ch. 2.4 - Assume that the population of the world in 2017...Ch. 2.4 - A factory makes custom sports cars at an...Ch. 2.4 - An employee joined a company in 2017 with a...Ch. 2.4 - Find a recurrence relation for the balance B(k)...Ch. 2.4 - Find a recurrence relation for the balance B(k)...Ch. 2.4 - For each of these lists of integers, provide a...Ch. 2.4 - For each of these lists of integers, provide a...Ch. 2.4 - *27. Show that if an denotes the nth positive...Ch. 2.4 - Let an , be the nth term of the sequence 1, 2, 2,...Ch. 2.4 - What are the values of these sums? k=15(k+1)...Ch. 2.4 - What are the values of these sums, where...Ch. 2.4 - What is the value of each of these sums of terms...Ch. 2.4 - Find the value of each of these sums. j=08(1+ ( 1...Ch. 2.4 - Compute each of these double sums. i=12j=13( i+j)...Ch. 2.4 - Compute each of these double sums. i=13j=12( i+j)...Ch. 2.4 - Show that j=1n(aja j1)=ana0 , where a0,a1,...,an...Ch. 2.4 - Use the identity 1/(k(k+1))=1/k1/(k+1) and...Ch. 2.4 - Sum both sides of the identity k2(k21)2=2k1 from...Ch. 2.4 - Use the technique given in Exercise 35, together...Ch. 2.4 - Find k=100200k . (Use Table 2.) TABLE 2 Some...Ch. 2.4 - Prob. 40ECh. 2.4 - Find k=1020k2(k3) . (Use Table 2.) TABLE 2 Some...Ch. 2.4 - Find . k=1020(k1)(2k2+1) (Use Table 2.) TABLE 2...Ch. 2.4 - Find a formula for k=0mk , when m is a positive...Ch. 2.4 - Find a formula for k=0mk3 , when m is a positive...Ch. 2.4 - There is also a special notation for products. The...Ch. 2.4 - Express n! using product notation.Ch. 2.4 - Find j=04j! .Ch. 2.4 - Find j=04j! .Ch. 2.5 - Prob. 1ECh. 2.5 - Determine whether each of these sets is finite,...Ch. 2.5 - Determine whether each of these sets is countable...Ch. 2.5 - Determine whether each of these sets is countable...Ch. 2.5 - Show that a finite group of guests arriving at...Ch. 2.5 - Suppose that Hilbert’s Grand Hotel is fully...Ch. 2.5 - Suppose that Hilbert’s Grand Hotel is fully...Ch. 2.5 - Show that a countably infinite number of guests...Ch. 2.5 - Suppose that a countably infinite number of buses,...Ch. 2.5 - Give an example of two uncountable sets A and B...Ch. 2.5 - Give an example of two uncountable sets A and B...Ch. 2.5 - Prob. 12ECh. 2.5 - Prob. 13ECh. 2.5 - Prob. 14ECh. 2.5 - Prob. 15ECh. 2.5 - Show that a subset of a countable set is also...Ch. 2.5 - Prob. 17ECh. 2.5 - Prob. 18ECh. 2.5 - Prob. 19ECh. 2.5 - Show that if |A|=|B| and |B|=|C| , then |A|=|C| .Ch. 2.5 - Prob. 21ECh. 2.5 - Suppose that A is a countable set. Show that the...Ch. 2.5 - Prob. 23ECh. 2.5 - Prob. 24ECh. 2.5 - Prob. 25ECh. 2.5 - Prob. 26ECh. 2.5 - Show that the union of a countable number of...Ch. 2.5 - Show that the set Z+Z+ is countableCh. 2.5 - Prob. 29ECh. 2.5 - Show that the set of real numbers that are...Ch. 2.5 - Show that Z+Z+ t is countable by showing that the...Ch. 2.5 - Show that when you substitute (3n+1)2 for each...Ch. 2.5 - Prob. 33ECh. 2.5 - Show that (0, 1) and R have the same cardinality...Ch. 2.5 - Prob. 35ECh. 2.5 - Prob. 36ECh. 2.5 - Show that the set of all computer programs in a...Ch. 2.5 - Prob. 38ECh. 2.5 - Prob. 39ECh. 2.5 - Show that if S is a set, then there does not exist...Ch. 2.5 - In this exercise, we prove the Schröder-Bernstein...Ch. 2.6 - Let A=[111320461137] . What size is A? What is the...Ch. 2.6 - Find A + B, where A=[104122022],B=[135223230]...Ch. 2.6 - Find AB if A=[2132],B=[0413] A=[110123],B=[321102]...Ch. 2.6 - Find the product AB, where...Ch. 2.6 - Find a matrix A such that [2314]A=[3012] . [Hint:...Ch. 2.6 - Find a matric A such that [132211403]A=[713103137]Ch. 2.6 - Prob. 7ECh. 2.6 - Prob. 8ECh. 2.6 - Prob. 9ECh. 2.6 - Prob. 10ECh. 2.6 - Prob. 11ECh. 2.6 - In this exercise we show that matrix...Ch. 2.6 - Prob. 13ECh. 2.6 - The nn matrix A=[aij] is called a diagonal matrix...Ch. 2.6 - Let A=[1101] . Find a formula for An , whenever n...Ch. 2.6 - Show that (At)t=A .Ch. 2.6 - Prob. 17ECh. 2.6 - Show that [231121113] Is the inverse of...Ch. 2.6 - Prob. 19ECh. 2.6 - Prob. 20ECh. 2.6 - Prob. 21ECh. 2.6 - Prob. 22ECh. 2.6 - Prob. 23ECh. 2.6 - Prob. 24ECh. 2.6 - Prob. 25ECh. 2.6 - Let A=[1101] and B=[0110] Find AB . AB . AB .Ch. 2.6 - Prob. 27ECh. 2.6 - Find the Boolean product of A and B, where...Ch. 2.6 - Prob. 29ECh. 2.6 - Let A be a zeroone matrix. Show that AA=A . AA=A .Ch. 2.6 - Prob. 31ECh. 2.6 - Prob. 32ECh. 2.6 - Prob. 33ECh. 2.6 - Prob. 34ECh. 2.6 - In this exercise we will show that the Boolean...Ch. 2 - Prob. 1RQCh. 2 - What is the empty set? Show that the empty set is...Ch. 2 - Define |S|, the cardinality of the set S. Give a...Ch. 2 - Define the power set of a set S. When is the empty...Ch. 2 - Define the union. intersection, difference, and...Ch. 2 - Prob. 6RQCh. 2 - Explain the relationship between logical...Ch. 2 - Prob. 8RQCh. 2 - Prob. 9RQCh. 2 - Define the inverse of a function. When does a...Ch. 2 - Prob. 11RQCh. 2 - Conjecture a formula for the terms of the sequence...Ch. 2 - Prob. 13RQCh. 2 - What is the sum of the terms of the geometric...Ch. 2 - Show that the set of odd integers is countable.Ch. 2 - Prob. 16RQCh. 2 - Prob. 17RQCh. 2 - Prob. 18RQCh. 2 - Prob. 1SECh. 2 - Prob. 2SECh. 2 - Prob. 3SECh. 2 - Prob. 4SECh. 2 - Prob. 5SECh. 2 - Prob. 6SECh. 2 - Prob. 7SECh. 2 - Prob. 8SECh. 2 - Prob. 9SECh. 2 - Prob. 10SECh. 2 - Prob. 11SECh. 2 - Prob. 12SECh. 2 - Prob. 13SECh. 2 - Prob. 14SECh. 2 - Prob. 15SECh. 2 - *16. Suppose that f is a function from the set A...Ch. 2 - Prob. 17SECh. 2 - Prob. 18SECh. 2 - Prob. 19SECh. 2 - Prob. 20SECh. 2 - Prob. 21SECh. 2 - Prob. 22SECh. 2 - Prob. 23SECh. 2 - Prove that if x is a real number, then x/2/2=x/4 .Ch. 2 - Prob. 25SECh. 2 - Prob. 26SECh. 2 - Prove that if m is a positive integer and x is a...Ch. 2 - We define the Ulam numbers by setting u1=1 and...Ch. 2 - Prob. 29SECh. 2 - Determine a rule for generating the terms of the...Ch. 2 - Prob. 31SECh. 2 - Prob. 32SECh. 2 - Prob. 33SECh. 2 - Show that the set of all finite subsets of the set...Ch. 2 - Prob. 35SECh. 2 - Prob. 36SECh. 2 - Prob. 37SECh. 2 - Prob. 38SECh. 2 - Prob. 39SECh. 2 - Prob. 40SECh. 2 - Prob. 41SECh. 2 - Prob. 1CPCh. 2 - Prob. 2CPCh. 2 - Prob. 3CPCh. 2 - Prob. 4CPCh. 2 - Prob. 5CPCh. 2 - Prob. 6CPCh. 2 - Prob. 7CPCh. 2 - Prob. 8CPCh. 2 - Prob. 9CPCh. 2 - Prob. 10CPCh. 2 - Prob. 11CPCh. 2 - Prob. 12CPCh. 2 - Prob. 1CAECh. 2 - Prob. 2CAECh. 2 - Use a computational program or programs you have...Ch. 2 - Prob. 4CAECh. 2 - Prob. 5CAECh. 2 - Use a computational program or programs you have...Ch. 2 - Prob. 1WPCh. 2 - Research where the concept of a function first...Ch. 2 - Explain the different ways in which the...Ch. 2 - Define the recently invented EKG sequence and...Ch. 2 - Prob. 5WPCh. 2 - Expand the discussion of the continuum hypothesis...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.Similar questions
- Question 5. We consider a put option with strike price K and expiration T. This option is priced using a 1-period CRR model. We consider r > 0, and σ > 0 very large. What is the approximate price of the option? In other words, what is the limit of the price of the option as σ∞. (Briefly justify your answer.)arrow_forwardQuestion 6. You collect daily data for the stock of a company Z over the past 4 months (i.e. 80 days) and calculate the log-returns (yk)/(-1. You want to build a CRR model for the evolution of the stock. The expected value and standard deviation of the log-returns are y = 0.06 and Sy 0.1. The money market interest rate is r = 0.04. Determine the risk-neutral probability of the model.arrow_forwardSeveral markets (Japan, Switzerland) introduced negative interest rates on their money market. In this problem, we will consider an annual interest rate r < 0. We consider a stock modeled by an N-period CRR model where each period is 1 year (At = 1) and the up and down factors are u and d. (a) We consider an American put option with strike price K and expiration T. Prove that if <0, the optimal strategy is to wait until expiration T to exercise.arrow_forward
- We consider an N-period CRR model where each period is 1 year (At = 1), the up factor is u = 0.1, the down factor is d = e−0.3 and r = 0. We remind you that in the CRR model, the stock price at time tn is modeled (under P) by Sta = So exp (μtn + σ√AtZn), where (Zn) is a simple symmetric random walk. (a) Find the parameters μ and σ for the CRR model described above. (b) Find P Ste So 55/50 € > 1). StN (c) Find lim P 804-N (d) Determine q. (You can use e- 1 x.) Ste (e) Find Q So (f) Find lim Q 004-N StN Soarrow_forwardIn this problem, we consider a 3-period stock market model with evolution given in Fig. 1 below. Each period corresponds to one year. The interest rate is r = 0%. 16 22 28 12 16 12 8 4 2 time Figure 1: Stock evolution for Problem 1. (a) A colleague notices that in the model above, a movement up-down leads to the same value as a movement down-up. He concludes that the model is a CRR model. Is your colleague correct? (Explain your answer.) (b) We consider a European put with strike price K = 10 and expiration T = 3 years. Find the price of this option at time 0. Provide the replicating portfolio for the first period. (c) In addition to the call above, we also consider a European call with strike price K = 10 and expiration T = 3 years. Which one has the highest price? (It is not necessary to provide the price of the call.) (d) We now assume a yearly interest rate r = 25%. We consider a Bermudan put option with strike price K = 10. It works like a standard put, but you can exercise it…arrow_forwardIn this problem, we consider a 2-period stock market model with evolution given in Fig. 1 below. Each period corresponds to one year (At = 1). The yearly interest rate is r = 1/3 = 33%. This model is a CRR model. 25 15 9 10 6 4 time Figure 1: Stock evolution for Problem 1. (a) Find the values of up and down factors u and d, and the risk-neutral probability q. (b) We consider a European put with strike price K the price of this option at time 0. == 16 and expiration T = 2 years. Find (c) Provide the number of shares of stock that the replicating portfolio contains at each pos- sible position. (d) You find this option available on the market for $2. What do you do? (Short answer.) (e) We consider an American put with strike price K = 16 and expiration T = 2 years. Find the price of this option at time 0 and describe the optimal exercising strategy. (f) We consider an American call with strike price K ○ = 16 and expiration T = 2 years. Find the price of this option at time 0 and describe…arrow_forward
- No chatgpt pls will upvote Alreadyarrow_forwardFind the LaPla se trnsofrom of a) chi-square Distribution. b) Normal Distribution. C) Gamma Distribution. prove that Binomial (n, 2) Poisson (2) *********************arrow_forward2.2, 13.2-13.3) question: 5 point(s) possible ubmit test The accompanying table contains the data for the amounts (in oz) in cans of a certain soda. The cans are labeled to indicate that the contents are 20 oz of soda. Use the sign test and 0.05 significance level to test the claim that cans of this soda are filled so that the median amount is 20 oz. If the median is not 20 oz, are consumers being cheated? Click the icon to view the data. What are the null and alternative hypotheses? OA. Ho: Medi More Info H₁: Medi OC. Ho: Medi H₁: Medi Volume (in ounces) 20.3 20.1 20.4 Find the test stat 20.1 20.5 20.1 20.1 19.9 20.1 Test statistic = 20.2 20.3 20.3 20.1 20.4 20.5 Find the P-value 19.7 20.2 20.4 20.1 20.2 20.2 P-value= (R 19.9 20.1 20.5 20.4 20.1 20.4 Determine the p 20.1 20.3 20.4 20.2 20.3 20.4 Since the P-valu 19.9 20.2 19.9 Print Done 20 oz 20 oz 20 oz 20 oz ce that the consumers are being cheated.arrow_forward
- T Teenage obesity (O), and weekly fast-food meals (F), among some selected Mississippi teenagers are: Name Obesity (lbs) # of Fast-foods per week Josh 185 10 Karl 172 8 Terry 168 9 Kamie Andy 204 154 12 6 (a) Compute the variance of Obesity, s²o, and the variance of fast-food meals, s², of this data. [Must show full work]. (b) Compute the Correlation Coefficient between O and F. [Must show full work]. (c) Find the Coefficient of Determination between O and F. [Must show full work]. (d) Obtain the Regression equation of this data. [Must show full work]. (e) Interpret your answers in (b), (c), and (d). (Full explanations required). Edit View Insert Format Tools Tablearrow_forwardH.w WI M Wz dy A Sindax Sind ①dlmax У тах at 0.75m from A W=6KN/M L=2 W2 = 9 KN/m P= 10 KN Barrow_forwardNo chatgpt pls will upvotearrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Algebra & Trigonometry with Analytic GeometryAlgebraISBN:9781133382119Author:SwokowskiPublisher:Cengage
Elementary Linear Algebra (MindTap Course List)AlgebraISBN:9781305658004Author:Ron LarsonPublisher:Cengage Learning
Glencoe Algebra 1, Student Edition, 9780079039897...AlgebraISBN:9780079039897Author:CarterPublisher:McGraw Hill
Algebra: Structure And Method, Book 1AlgebraISBN:9780395977224Author:Richard G. Brown, Mary P. Dolciani, Robert H. Sorgenfrey, William L. ColePublisher:McDougal Littell
College Algebra (MindTap Course List)AlgebraISBN:9781305652231Author:R. David Gustafson, Jeff HughesPublisher:Cengage Learning
Algebra & Trigonometry with Analytic Geometry
Algebra
ISBN:9781133382119
Author:Swokowski
Publisher:Cengage
Elementary Linear Algebra (MindTap Course List)
Algebra
ISBN:9781305658004
Author:Ron Larson
Publisher:Cengage Learning
Glencoe Algebra 1, Student Edition, 9780079039897...
Algebra
ISBN:9780079039897
Author:Carter
Publisher:McGraw Hill
Algebra: Structure And Method, Book 1
Algebra
ISBN:9780395977224
Author:Richard G. Brown, Mary P. Dolciani, Robert H. Sorgenfrey, William L. Cole
Publisher:McDougal Littell
College Algebra (MindTap Course List)
Algebra
ISBN:9781305652231
Author:R. David Gustafson, Jeff Hughes
Publisher:Cengage Learning
Propositional Logic, Propositional Variables & Compound Propositions; Author: Neso Academy;https://www.youtube.com/watch?v=Ib5njCwNMdk;License: Standard YouTube License, CC-BY
Propositional Logic - Discrete math; Author: Charles Edeki - Math Computer Science Programming;https://www.youtube.com/watch?v=rL_8y2v1Guw;License: Standard YouTube License, CC-BY
DM-12-Propositional Logic-Basics; Author: GATEBOOK VIDEO LECTURES;https://www.youtube.com/watch?v=pzUBrJLIESU;License: Standard Youtube License
Lecture 1 - Propositional Logic; Author: nptelhrd;https://www.youtube.com/watch?v=xlUFkMKSB3Y;License: Standard YouTube License, CC-BY
MFCS unit-1 || Part:1 || JNTU || Well formed formula || propositional calculus || truth tables; Author: Learn with Smily;https://www.youtube.com/watch?v=XV15Q4mCcHc;License: Standard YouTube License, CC-BY