Business Analytics
3rd Edition
ISBN: 9780135231678
Author: Evans, James R. (james Robert)
Publisher: PEARSON EDUCATION (COLLEGE)
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Chapter 2, Problem 30PE
To determine
Obtain the order number and the supplier totalling $9,045 and also provide
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solving problem 1
select bmw stock. you can assume the price of the stock
This problem is based on the fundamental option pricing formula for the continuous-time
model developed in class, namely the value at time 0 of an option with maturity T and
payoff F is given by:
We consider the two options below:
Fo=
-rT
= e
Eq[F].
1
A. An option with which you must buy a share of stock at expiration T = 1 for strike
price K = So.
B. An option with which you must buy a share of stock at expiration T = 1 for strike
price K given by
T
K =
T
St dt.
(Note that both options can have negative payoffs.) We use the continuous-time Black-
Scholes model to price these options. Assume that the interest rate on the money market
is r.
(a) Using the fundamental option pricing formula, find the price of option A. (Hint:
use the martingale properties developed in the lectures for the stock price process
in order to calculate the expectations.)
(b) Using the fundamental option pricing formula, find the price of option B.
(c) Assuming the interest rate is very small (r ~0), use Taylor…
Chapter 2 Solutions
Business Analytics
Ch. 2 - Explain the difference between a data set and a...Ch. 2 - For the Monthly Product Sales Excel file, use the...Ch. 2 - For the Monthly Product Sales Excel file, use the...Ch. 2 - What does the term filtering mean in the context...Ch. 2 - Convert the Credit Risk database to an Excel...Ch. 2 - Sort the data in the purchase orders database from...Ch. 2 - Prob. 2.4CYUCh. 2 - Prob. 3.1CYUCh. 2 - Prob. 3.2CYUCh. 2 - Prob. 3.3CYU
Ch. 2 - Prob. 4.1CYUCh. 2 - In the Purchase Orders database, what will =...Ch. 2 - Prob. 4.3CYUCh. 2 - Prob. 5.1CYUCh. 2 - Prob. 5.2CYUCh. 2 - Prob. 5.3CYUCh. 2 - Prob. 5.4CYUCh. 2 - Prob. 6.1CYUCh. 2 - Prob. 6.2CYUCh. 2 - Prob. 6.3CYUCh. 2 - The Excel file MBA Motivation and Salary...Ch. 2 - Prob. 2PECh. 2 - The Budget Forecasting database shows estimated...Ch. 2 - Convert the Store and Regional Sales database to...Ch. 2 - Convert the Purchase Orders database to an Excel...Ch. 2 - Prob. 6PECh. 2 - The Excel file Corporate Default Database...Ch. 2 - Open the Excel file Store and Regional Sales...Ch. 2 - In the Excel file Automobile Quality, search for...Ch. 2 - In the Purchase Orders database, conduct a Pareto...Ch. 2 - Conduct a Pareto analysis for the number of...Ch. 2 - Prob. 12PECh. 2 - In the Sales Transactions database, use Excels...Ch. 2 - Filter the data in the Bicycle Inventory database...Ch. 2 - Use the Excel file Credit Risk Data that was...Ch. 2 - Apply the Advanced Filter to the Credit Risk Data...Ch. 2 - Prob. 17PECh. 2 - Prob. 18PECh. 2 - Modify the data in the Base Data worksheet in the...Ch. 2 - Prob. 20PECh. 2 - Figure 2.41 shows the 2016 U.S. federal income tax...Ch. 2 - For the Bicycle Inventory database, write a...Ch. 2 - Prob. 23PECh. 2 - A manager needs to identify some information from...Ch. 2 - The Excel file SP 500 provides open, high, low,...Ch. 2 - Enhance the Sales Transactions database file to...Ch. 2 - Prob. 27PECh. 2 - For this exercise, use the Purchase Orders...Ch. 2 - Use INDEX and MATCH functions to fill in a table...Ch. 2 - Prob. 30PECh. 2 - Prob. 31PECh. 2 - Prob. 32PECh. 2 - Prob. 33PECh. 2 - Prob. 34PECh. 2 - A college graduate who is living in Cincinnati...Ch. 2 - The Excel file Payroll Data provides hourly...Ch. 2 - Construct PivotTables showing the counts of gender...Ch. 2 - Prob. 38PECh. 2 - Prob. 39PECh. 2 - Prob. 40PECh. 2 - Prob. 2.1C
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