Discrete Mathematics With Applications
5th Edition
ISBN: 9781337694193
Author: EPP, Susanna S.
Publisher: Cengage Learning,
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Chapter 4.5, Problem 41ES
To determine
To prove:
Prove that for all real numbers x and y,
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Chapter 4 Solutions
Discrete Mathematics With Applications
Ch. 4.1 - An integer is even if, and only if,_______.Ch. 4.1 - An integer is odd if, and only if,____Ch. 4.1 - An integer n is prime if, and only if,_______Ch. 4.1 - The most common way to disprove a universal...Ch. 4.1 - Prob. 5TYCh. 4.1 - To use the method of direct proof to prove a...Ch. 4.1 - In 1-4 justify your answer by using the...Ch. 4.1 - In 1-4 justify your answer by using by the...Ch. 4.1 - In 1-4 justify your answers by using the...Ch. 4.1 - In 1-4 justify your answers by using the...
Ch. 4.1 - Prove the statements in 5-11. There are integers m...Ch. 4.1 - Prove the statements in 5-11. There are distinct...Ch. 4.1 - Prove the statements in 5—11. 7. There are real...Ch. 4.1 - Prob. 8ESCh. 4.1 - Prove the statements in 5-11. There is a real...Ch. 4.1 - Prob. 10ESCh. 4.1 - Prove the statements in 5-11. There is an integer...Ch. 4.1 - In 12-13, (a) write a negation for the given...Ch. 4.1 - In 12-13, (a) write a negation for the given...Ch. 4.1 - Prob. 14ESCh. 4.1 - Disprove each of the statements in 14-16 by giving...Ch. 4.1 - Disprove each of the statements in 14-16 by giving...Ch. 4.1 - In 17-20, determine whether the property is true...Ch. 4.1 - In 17-20, determine whether the property is true...Ch. 4.1 - In 17-20, determine whether the property is true...Ch. 4.1 - In 17-20, determine whether the property is true...Ch. 4.1 - Prob. 21ESCh. 4.1 - Prove the statement is 21 and 22 by the method of...Ch. 4.1 - Prob. 23ESCh. 4.1 - Each of the statements in 23—26 is true. For each....Ch. 4.1 - Prob. 25ESCh. 4.1 - Prob. 26ESCh. 4.1 - Fill in the blanks in the following proof....Ch. 4.1 - In each of 28-31: a. Rewrite the theorem in three...Ch. 4.1 - In each of 28-31: a. Rewrite the theorem in three...Ch. 4.1 - In each of 28-31: a. Rewrite the theorem in three...Ch. 4.1 - Theorem 4,1-2: The sum of any even integer and...Ch. 4.2 - The meaning of every variable used in a proof...Ch. 4.2 - Proofs should be written in sentences that are...Ch. 4.2 - Every assertion in a proof should be supported by...Ch. 4.2 - Prob. 4TYCh. 4.2 - A new thought or fact that does not follow as an...Ch. 4.2 - Prob. 6TYCh. 4.2 - Displaying equations and inequalities increases...Ch. 4.2 - Some proof-writing mistakes are...Ch. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prob. 4ESCh. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prob. 7ESCh. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prob. 10ESCh. 4.2 - Prove the statements in 1-11. In each case use...Ch. 4.2 - Prove that the statements in 12—14 are false....Ch. 4.2 - Prove that the statements in 12—14 are false....Ch. 4.2 - Prove that the statements in 12-14 are false....Ch. 4.2 - Find the mistakes in the “proofs” shown in 15-19....Ch. 4.2 - Prob. 16ESCh. 4.2 - Prob. 17ESCh. 4.2 - Find the mistakes in the “proofs” show in 15-19....Ch. 4.2 - Find the mistakes in the “proofs” shown in 15-19....Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - Prob. 23ESCh. 4.2 - Prob. 24ESCh. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - Prob. 28ESCh. 4.2 - Prob. 29ESCh. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - Prob. 32ESCh. 4.2 - Prob. 33ESCh. 4.2 - In 20-38 determine whether the statement is true...Ch. 4.2 - Prob. 35ESCh. 4.2 - Prob. 36ESCh. 4.2 - Prob. 37ESCh. 4.2 - Prob. 38ESCh. 4.2 - Suppose that integers m and n are perfect squares....Ch. 4.2 - Prob. 40ESCh. 4.2 - Prob. 41ESCh. 4.3 - To show that a real number is rational, we must...Ch. 4.3 - Prob. 2TYCh. 4.3 - Prob. 3TYCh. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - Prob. 3ESCh. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - The numbers in 1—7 are all rational. Write each...Ch. 4.3 - The zero product property, says that if a product...Ch. 4.3 - Assume that a and b are both integers and that a0...Ch. 4.3 - Assume that m and n are both integers and that n0...Ch. 4.3 - Prove that every integer is a rational number.Ch. 4.3 - Prob. 12ESCh. 4.3 - Prob. 13ESCh. 4.3 - Consider the statement: The cube of any rational...Ch. 4.3 - Prob. 15ESCh. 4.3 - Determine which of the statements in 15—19 are...Ch. 4.3 - Prob. 17ESCh. 4.3 - Determine which of the statements in 15—19 are...Ch. 4.3 - Determine which of the statements in 15—19 are...Ch. 4.3 - Use the results of exercises 18 and 19 to prove...Ch. 4.3 - Prob. 21ESCh. 4.3 - Use the properties of even and odd integers that...Ch. 4.3 - Use the properties of even and odd integers that...Ch. 4.3 - Prob. 24ESCh. 4.3 - Derive the statements in 24-26 as corollaries of...Ch. 4.3 - Derive the statements in 24-26 as corollaries of...Ch. 4.3 - It is a fact that if n is any nonnegative integer,...Ch. 4.3 - Suppose a, b, c, and d are integers and ac ....Ch. 4.3 - Suppose a,b, and c are integers and x,y and z are...Ch. 4.3 - Prove that one solution for a quadratic equation...Ch. 4.3 - Prob. 31ESCh. 4.3 - Prove that for every real number c, if c is a root...Ch. 4.3 - Use the properties of even and odd integers that...Ch. 4.3 - Prob. 34ESCh. 4.3 - Prob. 35ESCh. 4.3 - In 35-39 find the mistakes in the “proofs” that...Ch. 4.3 - Prob. 37ESCh. 4.3 - In 35-39 find the mistakes in the "proofs” that...Ch. 4.3 - In 35-39 find the mistakes in the “proofs” that...Ch. 4.4 - TO show that a nonzero integer d divides an...Ch. 4.4 - To say that d divides n means the same as saying...Ch. 4.4 - Prob. 3TYCh. 4.4 - Prob. 4TYCh. 4.4 - Prob. 5TYCh. 4.4 - The transitivity of divisibility theorem says that...Ch. 4.4 - Prob. 7TYCh. 4.4 - Prob. 8TYCh. 4.4 - Prob. 1ESCh. 4.4 - Give a reason for your answer in each of 1-13,...Ch. 4.4 - Prob. 3ESCh. 4.4 - Give a reason for your answer in each of 1-13,...Ch. 4.4 - Give a reason for your answer in each of 1-13,...Ch. 4.4 - Prob. 6ESCh. 4.4 - Prob. 7ESCh. 4.4 - Prob. 8ESCh. 4.4 - Give a reason for your answer in each of 1-13,...Ch. 4.4 - Prob. 10ESCh. 4.4 - Prob. 11ESCh. 4.4 - Prob. 12ESCh. 4.4 - Give a reason for your answer in each of 1—13....Ch. 4.4 - Fill in the blanks in the following proof that for...Ch. 4.4 - Prove statements 15 and 16 directly from the the...Ch. 4.4 - Prob. 16ESCh. 4.4 - Prob. 17ESCh. 4.4 - Consider the following statement: The negative of...Ch. 4.4 - Show that the following statement is false: For...Ch. 4.4 - Prob. 20ESCh. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - Prob. 22ESCh. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - Prob. 24ESCh. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - Prob. 26ESCh. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - For each statements in 20-32, determine whether...Ch. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - For each statement in 20-32, determine whether the...Ch. 4.4 - For each statement in 20—32, determine whether the...Ch. 4.4 - Prob. 33ESCh. 4.4 - Consider a string consisting of a’s, b’s, and c’s...Ch. 4.4 - Two athletes run a circular track at a steady pace...Ch. 4.4 - It can be shown (see exercises 44-48) that an...Ch. 4.4 - Use the unique factorization theorem to write the...Ch. 4.4 - Let n=8,424. Write the prime factorization for n....Ch. 4.4 - Prob. 39ESCh. 4.4 - Prob. 40ESCh. 4.4 - How many zeros are at the end of 458.885 ? Explain...Ch. 4.4 - Prob. 42ESCh. 4.4 - At a certain university 2/3 of the mathematics...Ch. 4.4 - Prove that if n is any nonnegative integer whose...Ch. 4.4 - Prove that if n is any nonnegative nonnegative...Ch. 4.4 - Prob. 46ESCh. 4.4 - Prob. 47ESCh. 4.4 - Prove that for any nonnegative integer n, if the...Ch. 4.4 - Prob. 49ESCh. 4.4 - The integer 123,123 has the form abc, abc, where...Ch. 4.5 - The quotient-remainder theorem says that for all...Ch. 4.5 - Prob. 2TYCh. 4.5 - Prob. 3TYCh. 4.5 - Prob. 4TYCh. 4.5 - Prob. 5TYCh. 4.5 - Prob. 6TYCh. 4.5 - For each of the values of n and d given in 1-6,...Ch. 4.5 - For each of the values of n and d given in 1-6,...Ch. 4.5 - For each of the values of n and d given in 1-6,...Ch. 4.5 - For each of the values of n and d given in 1-6,...Ch. 4.5 - Prob. 5ESCh. 4.5 - For each of the values of n and d given in 1-6,...Ch. 4.5 - Evalute the expressions in 7-10 43div9 43mod9Ch. 4.5 - Evalute the expressions in7-10 50div7 50mod7Ch. 4.5 - Evalute the expressions in7-10 28div5 28mod5Ch. 4.5 - Prob. 10ESCh. 4.5 - Check the correctness of formula (4.5.1) given in...Ch. 4.5 - Justify formula (4.5.1) for general values of DayT...Ch. 4.5 - On a Monday a friend says he will meet you again...Ch. 4.5 - If today isTuesday, what day of the week will it...Ch. 4.5 - January 1,2000, was a Saturday, and 2000 was a...Ch. 4.5 - Prob. 16ESCh. 4.5 - Prove directky from the definitions that for every...Ch. 4.5 - Prove that the product of any two consecutive...Ch. 4.5 - Prove directly from the definitions that for all...Ch. 4.5 - Prob. 20ESCh. 4.5 - Suppose b is any integer. If bmod12=5 , what is...Ch. 4.5 - Suppose c is any integer. If c mod 15=3 , what is...Ch. 4.5 - Prove that for every integer n, if mod 5=3 then...Ch. 4.5 - Prove that for all integers m and n, if m mod 5=2...Ch. 4.5 - Prove that for all integrs a and b, if a mod 7=5...Ch. 4.5 - Prove that a necessary and sufficient and...Ch. 4.5 - Use the quotient-remainder theorem with divisor...Ch. 4.5 - Prove: Given any set of three consecutive...Ch. 4.5 - Use the quotient-remainder theorem with divisor...Ch. 4.5 - Use the quotient-remainder theorem with divisor...Ch. 4.5 - In 31-33, you may use the properties listed in...Ch. 4.5 - In 31-33, yoy may use the properties listed in...Ch. 4.5 - In 31-33, you may use the properties listed in...Ch. 4.5 - Given any integer n, if n3 , could n, n+2 , and...Ch. 4.5 - Prob. 35ESCh. 4.5 - Prove each of the statements in 35-43. The product...Ch. 4.5 - Prove each of the statements in 35-43. For any...Ch. 4.5 - Prove of the statements in 35-43. For every...Ch. 4.5 - Prove each of the statement in 35-43. Every prime...Ch. 4.5 - Prob. 40ESCh. 4.5 - Prob. 41ESCh. 4.5 - Prove each of the statements if 35-43. For all...Ch. 4.5 - Prob. 43ESCh. 4.5 - A matrix M has 3 rows and 4 columns. [ a 11 a 12 a...Ch. 4.5 - Prob. 45ESCh. 4.5 - Prob. 46ESCh. 4.5 - If m, n, and d are integers, d0 , and d(mn) , what...Ch. 4.5 - Prob. 48ESCh. 4.5 - Prob. 49ESCh. 4.5 - Prob. 50ESCh. 4.6 - Given any real number x, the floor of x is the...Ch. 4.6 - Prob. 2TYCh. 4.6 - Prob. 1ESCh. 4.6 - Compute x and x for each of the values of x in...Ch. 4.6 - Prob. 3ESCh. 4.6 - Compute x and x for each of the values of x in...Ch. 4.6 - Use the floor notation to express 259 div 11 and...Ch. 4.6 - If k is an integer, what is [k]? Why?Ch. 4.6 - If k is an integer, what is [k+12] ? Why?Ch. 4.6 - Prob. 8ESCh. 4.6 - Prob. 9ESCh. 4.6 - Prob. 10ESCh. 4.6 - Prob. 11ESCh. 4.6 - Prob. 12ESCh. 4.6 - Prob. 13ESCh. 4.6 - Prob. 14ESCh. 4.6 - Prob. 15ESCh. 4.6 - Some of the statements in 15-22 are true and some...Ch. 4.6 - Prob. 17ESCh. 4.6 - Prob. 18ESCh. 4.6 - Some of the statements is 15-22 are ture and some...Ch. 4.6 - Prob. 20ESCh. 4.6 - Prob. 21ESCh. 4.6 - Prob. 22ESCh. 4.6 - Prob. 23ESCh. 4.6 - Prob. 24ESCh. 4.6 - Prob. 25ESCh. 4.6 - Prob. 26ESCh. 4.6 - Prob. 27ESCh. 4.6 - Prob. 28ESCh. 4.6 - Prove each of the statements in 23-33. 29. For any...Ch. 4.6 - Prob. 30ESCh. 4.6 - Prob. 31ESCh. 4.6 - Prob. 32ESCh. 4.6 - Prob. 33ESCh. 4.7 - To prove a statement by contradiction, you suppose...Ch. 4.7 - Prob. 2TYCh. 4.7 - Prob. 3TYCh. 4.7 - Fill in the blanks in the following proof by...Ch. 4.7 - Is 10 an irrational numbre? Explain.Ch. 4.7 - Prob. 3ESCh. 4.7 - Use proof by contradiction to show that for every...Ch. 4.7 - Prob. 5ESCh. 4.7 - Prob. 6ESCh. 4.7 - Carefully formulate the negations of each of the...Ch. 4.7 - Fill in the blanks for the following proof that...Ch. 4.7 - a. When asked to prove that the difference of any...Ch. 4.7 - Let S be the statement: For all positive real...Ch. 4.7 - Let T be the statement: The sum of any two...Ch. 4.7 - Let R be the statement: The square root of any...Ch. 4.7 - Let S be the statement: The product of any...Ch. 4.7 - Let T be the statements: For every integer a, if...Ch. 4.7 - Do there exist integers a,b, and c such that a,b,...Ch. 4.7 - Prove each staement in 16-19 by contradiction. For...Ch. 4.7 - Prob. 17ESCh. 4.7 - Prove each statemtent in 16-19 by contradiction....Ch. 4.7 - Prove each statemet in 16-19 by contradiction. For...Ch. 4.7 - Fill in the blanks in the following proof by...Ch. 4.7 - Consider the statement “For everyinteger n, if n2...Ch. 4.7 - Consider the statement “For every real number r,...Ch. 4.7 - Prob. 23ESCh. 4.7 - Prove each of the statement in 23-24 in two ways:...Ch. 4.7 - Prob. 25ESCh. 4.7 - Use any method to prove the statements in 26-29....Ch. 4.7 - Use any method to prove the statements in 26-29....Ch. 4.7 - Use any method to prove the statements in 26-29....Ch. 4.7 - Prob. 29ESCh. 4.7 - Let n=53. Find an approximate value for n and...Ch. 4.7 - a. Prove by contraposition: For all positive...Ch. 4.7 - Prob. 32ESCh. 4.7 - The sieve of Eratosthenes, name after its...Ch. 4.7 - Prob. 34ESCh. 4.7 - Use proof by contradiction to show that every...Ch. 4.7 - Prob. 36ESCh. 4.8 - The ancient Greeks discovered that in a right...Ch. 4.8 - One way to prove that 2 is an irrational number is...Ch. 4.8 - One way to prove that there are infinitely many...Ch. 4.8 - Prob. 1ESCh. 4.8 - Prob. 2ESCh. 4.8 - Prob. 3ESCh. 4.8 - Prob. 4ESCh. 4.8 - Let S be the statement: The cube root of every...Ch. 4.8 - Prob. 6ESCh. 4.8 - Prob. 7ESCh. 4.8 - Prob. 8ESCh. 4.8 - Determine which statements in 6-16 are true and...Ch. 4.8 - Prob. 10ESCh. 4.8 - Determine which statements in 6-16 are true and...Ch. 4.8 - Determine which statements in 6-16 are true and...Ch. 4.8 - Determine which statements in 6-16 are true and...Ch. 4.8 - Prob. 14ESCh. 4.8 - Determine which statements in 6-16 are true and...Ch. 4.8 - Prob. 16ESCh. 4.8 - Prob. 17ESCh. 4.8 - a. Prove that for every integer a, if a3 is even...Ch. 4.8 - Use proof by contradiction to show that for any...Ch. 4.8 - Prob. 20ESCh. 4.8 - Prob. 21ESCh. 4.8 - Prove that 5 is irrational.Ch. 4.8 - Prob. 23ESCh. 4.8 - Prob. 24ESCh. 4.8 - Use the proof technique illustrated in exercise 24...Ch. 4.8 - Prob. 26ESCh. 4.8 - Prob. 27ESCh. 4.8 - Prob. 28ESCh. 4.8 - Suppose a is an integer and p is a prime number...Ch. 4.8 - Let p1,p2,p3,... be a list of all prime numbers in...Ch. 4.8 - Prob. 31ESCh. 4.8 - Prob. 32ESCh. 4.8 - Prove that if p1,p2...., and pn are distinct prime...Ch. 4.8 - Prob. 34ESCh. 4.8 - Prob. 35ESCh. 4.8 - Prob. 36ESCh. 4.8 - Prob. 37ESCh. 4.8 - Prob. 38ESCh. 4.9 - The toatl degree of a graph is defined as_____Ch. 4.9 - Prob. 2TYCh. 4.9 - In any graph the number of vertices of odd degree...Ch. 4.9 - Prob. 4TYCh. 4.9 - Prob. 5TYCh. 4.9 - Prob. 6TYCh. 4.9 - Prob. 1ESCh. 4.9 - Prob. 2ESCh. 4.9 - A graph has vertices of degrees 0,2,2,3, and 9....Ch. 4.9 - A graph has vertices of degrees ,1,1,4,4, and 6....Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5-13 either draw a graph with the...Ch. 4.9 - In each of 5—13 either draw a graph with the...Ch. 4.9 - Prob. 12ESCh. 4.9 - Prob. 13ESCh. 4.9 - Prob. 14ESCh. 4.9 - A small social network contains three people who...Ch. 4.9 - a. In a group of 15 people, is it possible for...Ch. 4.9 - In a group of 25 people, is it possible for each...Ch. 4.9 - Is there a simple graph, each of whose vertices...Ch. 4.9 - Prob. 19ESCh. 4.9 - Draw K6, a complete graph on six vertices. Use the...Ch. 4.9 - In a simple graph, must every vertex have degree...Ch. 4.9 - Prob. 22ESCh. 4.9 - Recall that Km,n denotes a complete bipartite...Ch. 4.9 - A (general) bipartite graph G is a simple graph...Ch. 4.9 - Prob. 25ESCh. 4.10 - When an algorithm statement of the form x:=e is...Ch. 4.10 - Consider an algorithm statement of the following...Ch. 4.10 - Prob. 3TYCh. 4.10 - Prob. 4TYCh. 4.10 - Given a nonnegative integer a and a positive...Ch. 4.10 - Prob. 6TYCh. 4.10 - If r is a positive integer, then gcd (r,0)=_____Ch. 4.10 - Prob. 8TYCh. 4.10 - Prob. 9TYCh. 4.10 - Find the value of z when each of the algorithm...Ch. 4.10 - Prob. 2ESCh. 4.10 - Consider the following algorithm segment:...Ch. 4.10 - Prob. 4ESCh. 4.10 - Prob. 5ESCh. 4.10 - Prob. 6ESCh. 4.10 - Make a trace table to trace the action of...Ch. 4.10 - Prob. 8ESCh. 4.10 - Prob. 9ESCh. 4.10 - Prob. 10ESCh. 4.10 - Prob. 11ESCh. 4.10 - Prob. 12ESCh. 4.10 - Prob. 13ESCh. 4.10 - Use the Euclidean algorithm to hand-calculate the...Ch. 4.10 - Use the Euclidean algorithm to hand-calculate the...Ch. 4.10 - Use the Euclidean algorithm to hand-calculate the...Ch. 4.10 - Make a trace table to trace the action of...Ch. 4.10 - Make a trace table to trace the action of...Ch. 4.10 - Make a trace table to trace the action of...Ch. 4.10 - Prob. 20ESCh. 4.10 - Prob. 21ESCh. 4.10 - Prove that for all positive integers a and b, a|b...Ch. 4.10 - Prove that if a and b are integers, not both zero,...Ch. 4.10 - Prob. 24ESCh. 4.10 - Prob. 25ESCh. 4.10 - Prob. 26ESCh. 4.10 - An alternative to the Euclidean algorithm uses...Ch. 4.10 - Prob. 28ESCh. 4.10 - Prob. 29ESCh. 4.10 - Prob. 30ESCh. 4.10 - Exercises 28—32 refer to the following definition....Ch. 4.10 - Prob. 32ES
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- 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
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