Introduction to Statistics and Data Analysis
5th Edition
ISBN: 9781305445963
Author: PECK
Publisher: Cengage
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Chapter 3, Problem 56CR
The stem-and-leaf display of Exercise 3.55 uses only four stems. Construct a stem-and-leaf display for these data using repeated stems 1H, 2L, 2H, … , 4L. For example, the first observation, 29, would have a stem of 2 and a leaf of 9. It would be entered into the display for the stem 2H, because it is a “high” 2—that is, it has a leaf that is on the high end (5, 6, 7, 8, 9).
3.55 The Connecticut Agricultural Experiment Station conducted a study of the calorie content of different types of beer. The calorie content (calories per 100 ml) for 26 brands of light beer are (from the web site brewery.org):
- a. Construct a stem-and-leaf display using stems 1, 2, 3, and 4.
- b. Write a sentence or two describing the calorie content of light beers.
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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 3 Solutions
Introduction to Statistics and Data Analysis
Ch. 3.1 - Each person in a nationally representative sample...Ch. 3.1 - The graphical display on the next page is similar...Ch. 3.1 - Prob. 3ECh. 3.1 - The National Confectioners Association asked 1006...Ch. 3.1 - College student attitudes about e-books were...Ch. 3.1 - Prob. 6ECh. 3.1 - Prob. 7ECh. 3.1 - Prob. 8ECh. 3.1 - Prob. 9ECh. 3.1 - The survey on student attitude toward e-books...
Ch. 3.1 - Prob. 11ECh. 3.1 - Prob. 12ECh. 3.1 - An article about college loans (New Rules Would...Ch. 3.1 - Prob. 14ECh. 3.2 - Prob. 15ECh. 3.2 - Prob. 16ECh. 3.2 - Prob. 17ECh. 3.2 - The article Economy Low, Generosity High (USA...Ch. 3.2 - Prob. 19ECh. 3.2 - A report from Texas Transportation Institute...Ch. 3.2 - The percentage of teens not in school or working...Ch. 3.3 - Prob. 22ECh. 3.3 - The accompanying data on annual maximum wind speed...Ch. 3.3 - The accompanying relative frequency table is based...Ch. 3.3 - Prob. 25ECh. 3.3 - Medicares new medical plans offer a wide range of...Ch. 3.3 - The following two relative frequency distributions...Ch. 3.3 - Prob. 28ECh. 3.3 - The report Trends in College Pricing 2012...Ch. 3.3 - An exam is given to students in an introductory...Ch. 3.3 - The accompanying frequency distribution summarizes...Ch. 3.3 - Example 3.19 used annual rainfall data for...Ch. 3.3 - Prob. 33ECh. 3.3 - Prob. 34ECh. 3.3 - Prob. 35ECh. 3.3 - Prob. 36ECh. 3.3 - Using the five class intervals 100 to 120, 120 to...Ch. 3.4 - Prob. 38ECh. 3.4 - Consumer Reports Health (consumerreports.org) gave...Ch. 3.4 - Prob. 40ECh. 3.4 - Prob. 41ECh. 3.4 - Prob. 42ECh. 3.4 - Prob. 43ECh. 3.4 - Prob. 44ECh. 3.4 - The accompanying time series plot of movie box...Ch. 3.5 - The accompanying comparative bar chart is similar...Ch. 3.5 - Prob. 47ECh. 3.5 - The figure at the top right of the next page is...Ch. 3.5 - The two graphical displays below are similar to...Ch. 3.5 - The following graphical display is similar to one...Ch. 3.5 - Explain why the following graphical display...Ch. 3 - Prob. 52CRCh. 3 - Prob. 53CRCh. 3 - Prob. 54CRCh. 3 - The Connecticut Agricultural Experiment Station...Ch. 3 - The stem-and-leaf display of Exercise 3.55 uses...Ch. 3 - Prob. 57CRCh. 3 - Prob. 58CRCh. 3 - Does the size of a transplanted organ matter? A...Ch. 3 - Prob. 60CRCh. 3 - Prob. 61CRCh. 3 - Prob. 62CRCh. 3 - The article Tobacco and Alcohol Use in G-Rated...Ch. 3 - Prob. 64CRCh. 3 - Prob. 65CRCh. 3 - Prob. 66CRCh. 3 - Prob. 67CRCh. 3 - Prob. 68CRCh. 3 - Prob. 69CRCh. 3 - Many nutritional experts have expressed concern...Ch. 3 - Americium 241 (241Am) is a radioactive material...Ch. 3 - Does eating broccoli reduce the risk of prostate...Ch. 3 - An article that appeared in USA TODAY (August 11,...Ch. 3 - Sometimes samples are composed entirely of...Ch. 3 - Prob. 4CRECh. 3 - More than half of Californias doctors say they are...Ch. 3 - Based on observing more than 400 drivers in the...Ch. 3 - An article from the Associated Press (May 14,...Ch. 3 - Prob. 8CRECh. 3 - Prob. 9CRECh. 3 - Prob. 10CRECh. 3 - The article Determination of Most Representative...Ch. 3 - The paper Lessons from Pacemaker Implantations...Ch. 3 - How does the speed of a runner vary over the...Ch. 3 - Prob. 14CRECh. 3 - One factor in the development of tennis elbow, a...Ch. 3 - An article that appeared in USA TODAY (September...
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