Statistics: Informed Decisions Using Data, Books a la Carte Edition plus NEW MyLab Statistics with Pearson eText-- Access Card Package (5th Edition)
5th Edition
ISBN: 9780134136783
Author: Michael Sullivan III
Publisher: PEARSON
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Chapter 2, Problem 6RE
(a)
To determine
To construct: A frequency distribution.
(b)
To determine
To construct: A relative frequency distribution.
(c)
To determine
To construct: A frequency histogram for the provided data.
(d)
To determine
To construct: A relative frequency histogram for the provided data.
(e)
To determine
The shape of the distribution.
(f)
Section 1:
To determine
To construct: The frequency distribution with class width 10.
Section 2:
To determine
To construct: A relative frequency distribution.
Section 3:
To determine
To construct: A frequency histogram.
Section 4:
To determine
To construct: A relative frequency histogram.
(g)
To determine
The best frequency distribution.
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In this problem, we consider a Brownian motion (W+) t≥0. We consider a stock model (St)t>0
given (under the measure P) by
d.St 0.03 St dt + 0.2 St dwt,
with So 2. We assume that the interest rate is r = 0.06. The purpose of this problem is to
price an option on this stock (which we name cubic put). This option is European-type, with
maturity 3 months (i.e. T = 0.25 years), and payoff given by
F = (8-5)+
(a) Write the Stochastic Differential Equation satisfied by (St) under the risk-neutral measure
Q. (You don't need to prove it, simply give the answer.)
(b) Give the price of a regular European put on (St) with maturity 3 months and strike K = 2.
(c) Let X =
S. Find the Stochastic Differential Equation satisfied by the process (Xt)
under the measure Q.
(d) Find an explicit expression for X₁ = S3 under measure Q.
(e) Using the results above, find the price of the cubic put option mentioned above.
(f) Is the price in (e) the same as in question (b)? (Explain why.)
Chapter 2 Solutions
Statistics: Informed Decisions Using Data, Books a la Carte Edition plus NEW MyLab Statistics with Pearson eText-- Access Card Package (5th Edition)
Ch. 2.1 - 1. Define raw data in your own words.
Ch. 2.1 - 2. A frequency distribution lists the _____ of...Ch. 2.1 - 3. In a relative frequency distribution, what...Ch. 2.1 - Prob. 4AYUCh. 2.1 - 5. Flu Season The pie chart shown, the type we see...Ch. 2.1 - 6. Cosmetic Surgery This USA Today–type chart...Ch. 2.1 - 7. Most Valuable Player The following Pareto chart...Ch. 2.1 - 8. Poverty The U.S. Census Bureau uses money...Ch. 2.1 - 9. Divorce The following graph represents the...Ch. 2.1 - Prob. 10AYU
Ch. 2.1 - 11. Made in America A random sample of 2163 adults...Ch. 2.1 - Prob. 12AYUCh. 2.1 - 13. College Survey In a national survey conducted...Ch. 2.1 - 14. College Survey In a national survey conducted...Ch. 2.1 - Prob. 15AYUCh. 2.1 - Prob. 16AYUCh. 2.1 - 17. Texting A survey of U.S. adults and teens...Ch. 2.1 - 18. Educational Attainment The educational...Ch. 2.1 - Prob. 19AYUCh. 2.1 - Prob. 20AYUCh. 2.1 - Prob. 21AYUCh. 2.1 - Prob. 22AYUCh. 2.1 - Prob. 23AYUCh. 2.1 - 24. Blood Type A phlebotomist draws the blood of a...Ch. 2.1 - Prob. 25AYUCh. 2.1 - Prob. 26AYUCh. 2.1 - 27. StatCrunch Survey Choose a qualitative...Ch. 2.1 - Prob. 28AYUCh. 2.1 - 29. Putting It Together: Online Homework Keeping...Ch. 2.1 - 30. When should relative frequencies be used when...Ch. 2.1 - Prob. 31AYUCh. 2.1 - Prob. 32AYUCh. 2.1 - Prob. 33AYUCh. 2.2 - 1. The categories by which data are grouped are...Ch. 2.2 - Prob. 2AYUCh. 2.2 - 3. The ______ is the difference between...Ch. 2.2 - Prob. 4AYUCh. 2.2 - 5. True or False: There is not one particular...Ch. 2.2 - 6. True or False: Stem-and-leaf plots are...Ch. 2.2 - 7. True or False: The shape of the distribution...Ch. 2.2 - Prob. 8AYUCh. 2.2 - Prob. 9AYUCh. 2.2 - 10. Car Sales A car salesman records the number of...Ch. 2.2 - 11. IQ Scores The following frequency histogram...Ch. 2.2 - Prob. 12AYUCh. 2.2 - Prob. 13AYUCh. 2.2 - In Problems 13 and 14, for each variable...Ch. 2.2 - 15. Predicting School Enrollment To predict future...Ch. 2.2 - Prob. 16AYUCh. 2.2 - Prob. 17AYUCh. 2.2 - Prob. 18AYUCh. 2.2 - Prob. 19AYUCh. 2.2 - Prob. 20AYUCh. 2.2 - Prob. 21AYUCh. 2.2 - Prob. 22AYUCh. 2.2 - Prob. 23AYUCh. 2.2 - Prob. 24AYUCh. 2.2 - 25. Televisions in the Household A researcher with...Ch. 2.2 - 26. Waiting The data below represent the number of...Ch. 2.2 - 27. Gini Index The Gini Index is a measure of how...Ch. 2.2 - 28. Average Income The following data represent...Ch. 2.2 - 29. Cigarette Tax Rates The table shows the tax,...Ch. 2.2 - 30. Dividend Yield A dividend is a payment from a...Ch. 2.2 - Prob. 31AYUCh. 2.2 - Prob. 32AYUCh. 2.2 - Prob. 33AYUCh. 2.2 - Prob. 34AYUCh. 2.2 - Prob. 35AYUCh. 2.2 - Prob. 36AYUCh. 2.2 - Prob. 37AYUCh. 2.2 - Prob. 38AYUCh. 2.2 - Prob. 39AYUCh. 2.2 - Prob. 40AYUCh. 2.2 - Prob. 41AYUCh. 2.2 - Prob. 42AYUCh. 2.2 - Prob. 43AYUCh. 2.2 - Prob. 44AYUCh. 2.2 - Prob. 45AYUCh. 2.2 - 46. Waiting Draw a dot plot of the waiting data...Ch. 2.2 - 47. Putting It Together: Time Viewing a Web Page...Ch. 2.2 - Prob. 48AYUCh. 2.2 - Prob. 49AYUCh. 2.2 - Prob. 50AYUCh. 2.2 - Prob. 51AYUCh. 2.2 - 52. Describe the situations in which it is...Ch. 2.2 - Prob. 53AYUCh. 2.2 - Prob. 54AYUCh. 2.3 - 1. What is an ogive?
Ch. 2.3 - Prob. 2AYUCh. 2.3 - Prob. 3AYUCh. 2.3 - Prob. 4AYUCh. 2.3 - Prob. 5AYUCh. 2.3 - Prob. 6AYUCh. 2.3 - 7. Graduation Rates The following relative...Ch. 2.3 - Prob. 8AYUCh. 2.3 - 9. Misery Index The following time-series plot...Ch. 2.3 - Prob. 10AYUCh. 2.3 - Prob. 11AYUCh. 2.3 - In Problems 13–16, use the frequency distributions...Ch. 2.3 - Prob. 13AYUCh. 2.3 - Prob. 14AYUCh. 2.3 - Prob. 15AYUCh. 2.3 - Prob. 16AYUCh. 2.3 - Prob. 17AYUCh. 2.3 - Prob. 18AYUCh. 2.3 - 19. Putting It Together: Rates of Return of Stocks...Ch. 2.3 - Prob. 20AYUCh. 2.3 - Prob. 21AYUCh. 2.3 - Prob. 22AYUCh. 2.3 - Prob. 23AYUCh. 2.4 - 1. Inauguration Cost The following is a USA...Ch. 2.4 - 2. Burning Calories The following is a USA...Ch. 2.4 - Prob. 3AYUCh. 2.4 - Prob. 4AYUCh. 2.4 - Prob. 5AYUCh. 2.4 - Prob. 6AYUCh. 2.4 - Prob. 7AYUCh. 2.4 - 8. You Explain It! Oil Reserves The U.S. Strategic...Ch. 2.4 - Prob. 9AYUCh. 2.4 - Prob. 10AYUCh. 2.4 - Prob. 11AYUCh. 2.4 - Prob. 12AYUCh. 2.4 - Prob. 13AYUCh. 2.4 - Prob. 14AYUCh. 2.4 - Prob. 15AYUCh. 2.4 - Prob. 16AYUCh. 2 - Prob. 1RECh. 2 - Prob. 2RECh. 2 - Prob. 3RECh. 2 - 4. Political Affiliation One hundred randomly...Ch. 2 - 5. Family Size A random sample of 60 couples...Ch. 2 - Prob. 6RECh. 2 - Prob. 7RECh. 2 - Prob. 8RECh. 2 - Prob. 9RECh. 2 - Prob. 10RECh. 2 - Prob. 11RECh. 2 - Prob. 12RECh. 2 - Prob. 1CTCh. 2 - Prob. 2CTCh. 2 - Prob. 3CTCh. 2 - 4. The following data represent the number of cars...Ch. 2 - Prob. 5CTCh. 2 - Prob. 6CTCh. 2 - 7. The following data represent the time (in...Ch. 2 - Prob. 8CTCh. 2 - Prob. 9CTCh. 2 - Prob. 1CSCh. 2 - Prob. 2CSCh. 2 - Prob. 3CSCh. 2 - Prob. 4CSCh. 2 - Prob. 5CSCh. 2 - Prob. 6CS
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