Mathematical Excursions (MindTap Course List)
4th Edition
ISBN: 9781305965584
Author: Richard N. Aufmann, Joanne Lockwood, Richard D. Nation, Daniel K. Clegg
Publisher: Cengage Learning
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Chapter 5, Problem 30RE
To determine
To represent:
The map by a graph and find a colouring of the graph.
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For each month of the year, Taylor collected the average high temperatures in Jackson, Mississippi. He used the data to create the histogram shown. Which set of data did he use to create the histogram?
A
55, 60, 64, 72, 73, 75, 77, 81, 83, 91, 91, 92\ 55,\ 60,\ 64,\ 72,\ 73,\ 75,\ 77,\ 81,\ 83,\ 91,\ 91,\ 92 55, 60, 64, 72, 73, 75, 77, 81, 83, 91, 91, 92
B
55, 57, 60, 65, 70, 71, 78, 79, 85, 86, 88, 91\ 55,\ 57,\ 60,\ 65,\ 70,\ 71,\ 78,\ 79,\ 85,\ 86,\ 88,\ 91 55, 57, 60, 65, 70, 71, 78, 79, 85, 86, 88, 91
C
55, 60, 63, 64, 65, 71, 83, 87, 88, 88, 89, 93\ 55,\ 60,\ 63,\ 64,\ 65,\ 71,\ 83,\ 87,\ 88,\ 88,\ 89,\ 93 55, 60, 63, 64, 65, 71, 83, 87, 88, 88, 89, 93
D
55, 58, 60, 66, 68, 75, 77, 82, 86, 89, 91, 91\ 55,\ 58,\ 60,\ 66,\ 68,\ 75,\ 77,\ 82,\ 86,\ 89,\ 91,\ 91 55, 58, 60, 66, 68, 75, 77, 82, 86, 89, 91, 91
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.)
Problem 4. Margrabe formula and the Greeks (20 pts)
In the homework, we determined the Margrabe formula for the price of an option allowing you to
swap an x-stock for a y-stock at time T. For stocks with initial values xo, yo, common volatility
σ and correlation p, the formula was given by
Fo=yo (d+)-x0Þ(d_),
where
In (±²
Ꭲ
d+
õ√T
and
σ = σ√√√2(1 - p).
дго
(a) We want to determine a "Greek" for ỡ on the option: find a formula for
θα
(b) Is
дго
θα
positive or negative?
(c) We consider a situation in which the correlation p between the two stocks increases: what
can you say about the price Fo?
(d) Assume that yo< xo and p = 1. What is the price of the option?
Chapter 5 Solutions
Mathematical Excursions (MindTap Course List)
Ch. 5.1 - A pen-tracing puzzle is given. See if you can find...Ch. 5.1 - A pen-tracing puzzle is given. See if you can find...Ch. 5.1 - A pen-tracing puzzle is given. See if you can find...Ch. 5.1 - A pen-tracing puzzle is given. See if you can find...Ch. 5.1 - Explain why the following pen-tracing puzzle is...Ch. 5.1 - Transportation An X in the table below indicates a...Ch. 5.1 - Transportation The table below shows the nonstop...Ch. 5.1 - Social Network A group of friends is represented...Ch. 5.1 - Prob. 4ESCh. 5.1 - Determine (a) the number of edges in the graph,...
Ch. 5.1 - Determine (a) the number of edges in the graph,...Ch. 5.1 - Determine (a) the number of edges in the graph,...Ch. 5.1 - Determine (a) the number of edges in the graph,...Ch. 5.1 - Determine whether the two graphs are equivalent.Ch. 5.1 - Determine whether the two graphs are equivalent.Ch. 5.1 - Determine whether the two graphs are equivalent.Ch. 5.1 - Determine whether the two graphs are equivalent.Ch. 5.1 - Explain why the following two graphs cannot be...Ch. 5.1 - Label the vertices of the second graph so that it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - (a) determine whether the graph is Eulerian. If it...Ch. 5.1 - Parks in Exercises 23 and 24, a map of a park is...Ch. 5.1 - Parks in Exercises 23 and 24, a map of a park is...Ch. 5.1 - Transportation For the train routes given in...Ch. 5.1 - Transportation For the direct air flights given in...Ch. 5.1 - Pets The diagram below shows the arrangement of a...Ch. 5.1 - Transportation A subway map is shown below. Is it...Ch. 5.1 - Prob. 29ESCh. 5.1 - Prob. 30ESCh. 5.1 - Degrees of Separation In the graph below, an edge...Ch. 5.1 - Social Network In the graph below, an edge...Ch. 5.1 - Prob. 33ESCh. 5.1 - Travel A map of South America is shown at the...Ch. 5.2 - Continue investigating Hamiltonian circuits in...Ch. 5.2 - Use the greedy algorithm and the weighted graph...Ch. 5.2 - Use the edge-picking algorithm to find a...Ch. 5.2 - Use Dirac's theorem to verify that the graph is...Ch. 5.2 - Use Dirac's theorem to verify that the graph is...Ch. 5.2 - Use Dirac's theorem to verify that the graph is...Ch. 5.2 - Use Dirac's theorem to verify that the graph is...Ch. 5.2 - Transportation For the train routes given in...Ch. 5.2 - Transportation For the direct air flights given in...Ch. 5.2 - Use trial and error to find two Hamiltonian...Ch. 5.2 - Use trial and error to find two Hamiltonian...Ch. 5.2 - Use trial and error to find two Hamiltonian...Ch. 5.2 - Use trial and error to find two Hamiltonian...Ch. 5.2 - Use the greedy algorithm to find a Hamiltonian...Ch. 5.2 - Use the greedy algorithm to find a Hamiltonian...Ch. 5.2 - Use the greedy algorithm to find a Hamiltonian...Ch. 5.2 - Use the greedy algorithm to find a Hamiltonian...Ch. 5.2 - Use the edge-picking algorithm to find a...Ch. 5.2 - Use the edge-picking algorithm to find a...Ch. 5.2 - Use the edge-picking algorithm to find a...Ch. 5.2 - Use the edge-picking algorithm to find a...Ch. 5.2 - Travel A company representative lives in...Ch. 5.2 - Travel A tourist is staying in Toronto, Canada,...Ch. 5.2 - Travel Use the edge-picking algorithm to design a...Ch. 5.2 - Travel Use the edge-picking algorithm to design a...Ch. 5.2 - Travel Nicole wants to tour Asia. She will start...Ch. 5.2 - Travel The prices for traveling between five...Ch. 5.2 - Travel Use the edge-picking algorithm to find a...Ch. 5.2 - Travel Use the edge-picking algorithm to find a...Ch. 5.2 - Route Planning Brian needs to visit the pet store,...Ch. 5.2 - Route Planning A bike messenger needs to deliver...Ch. 5.2 - Scheduling A research company has a large...Ch. 5.2 - Computer Networks A small office wishes to network...Ch. 5.2 - Route Planning A security officer patrolling a...Ch. 5.2 - Route Planning A city engineer needs to inspect...Ch. 5.2 - Draw a connected graph with six vertices that has...Ch. 5.2 - Assign weights to the edges of the following...Ch. 5.3 - The tetrahedron in figure 5.20 consists of four...Ch. 5.3 - The following graph is the projection of one ofthe...Ch. 5.3 - Prob. 3EECh. 5.3 - Give a reason why the graph below Cannot be the...Ch. 5.3 - Prob. 1ESCh. 5.3 - Prob. 2ESCh. 5.3 - Prob. 3ESCh. 5.3 - Prob. 4ESCh. 5.3 - Prob. 5ESCh. 5.3 - Prob. 6ESCh. 5.3 - Prob. 7ESCh. 5.3 - Prob. 8ESCh. 5.3 - Prob. 9ESCh. 5.3 - Prob. 10ESCh. 5.3 - Prob. 11ESCh. 5.3 - Prob. 12ESCh. 5.3 - Show that the following graph contracts to K5.Ch. 5.3 - Show that the following graph contracts to the...Ch. 5.3 - Prob. 15ESCh. 5.3 - Prob. 16ESCh. 5.3 - Prob. 17ESCh. 5.3 - Count the number of vertices, edges, and faces,...Ch. 5.3 - Count the number of vertices, edges, and faces,...Ch. 5.3 - Count the number of vertices, edges, and faces,...Ch. 5.3 - Count the number of vertices, edges, and faces,...Ch. 5.3 - Count the number of vertices, edges, and faces,...Ch. 5.3 - Prob. 23ESCh. 5.3 - Prob. 24ESCh. 5.3 - Prob. 25ESCh. 5.3 - Prob. 26ESCh. 5.3 - Prob. 27ESCh. 5.3 - Prob. 28ESCh. 5.3 - Prob. 29ESCh. 5.3 - Prob. 30ESCh. 5.4 - A one-way road ends at a two-way street. The...Ch. 5.4 - A one-way road intersects a two-way road in a...Ch. 5.4 - A two-way road intersects another two-way road in...Ch. 5.4 - Prob. 1ESCh. 5.4 - Prob. 2ESCh. 5.4 - Prob. 3ESCh. 5.4 - Prob. 4ESCh. 5.4 - Prob. 5ESCh. 5.4 - Prob. 6ESCh. 5.4 - Prob. 7ESCh. 5.4 - Prob. 8ESCh. 5.4 - Prob. 9ESCh. 5.4 - Prob. 10ESCh. 5.4 - Prob. 11ESCh. 5.4 - Prob. 12ESCh. 5.4 - Prob. 13ESCh. 5.4 - Prob. 14ESCh. 5.4 - Prob. 15ESCh. 5.4 - Prob. 16ESCh. 5.4 - Prob. 17ESCh. 5.4 - Prob. 18ESCh. 5.4 - Prob. 19ESCh. 5.4 - Prob. 20ESCh. 5.4 - Prob. 21ESCh. 5.4 - Prob. 22ESCh. 5.4 - Scheduling Six different groups of children would...Ch. 5.4 - Scheduling Five different charity organizations...Ch. 5.4 - Scheduling Students in a film class have...Ch. 5.4 - Animal Housing A researcher has discovered six new...Ch. 5.4 - Prob. 27ESCh. 5.4 - Prob. 28ESCh. 5.4 - Prob. 29ESCh. 5.4 - Prob. 30ESCh. 5.4 - Scheduling Edge colorings, as explained in...Ch. 5 - (a) determine the number of edges in the graph,...Ch. 5 - (a) determine the number of edges in the graph,...Ch. 5 - Soccer In the table below, an X indicates teams...Ch. 5 - Each vertex in the graph at the left represents a...Ch. 5 - Determine whether the two graphs are equivalent.Ch. 5 - Determine whether the two graphs are equivalent.Ch. 5 - Find an Euler path if possible, and (b) find an...Ch. 5 - Find an Euler path if possible, and (b) find an...Ch. 5 - Find an Euler path if possible, and (b) find an...Ch. 5 - Prob. 10RECh. 5 - Prob. 11RECh. 5 - Architecture The floor plan of a sculpture gallery...Ch. 5 - Use Dirac's theorem to verify that the graph is...Ch. 5 - Use Dirac's theorem to verify that the graph is...Ch. 5 - Prob. 15RECh. 5 - Prob. 16RECh. 5 - Use the greedy algorithm to find a Hamiltonian...Ch. 5 - Use the greedy algorithm to find a Hamiltonian...Ch. 5 - Use the edge-picking algorithm to find a...Ch. 5 - Use the edge-picking algorithm to find a...Ch. 5 - Efficient Route The distances, in miles, between...Ch. 5 - Computer Networking A small office needs to...Ch. 5 - Prob. 23RECh. 5 - Prob. 24RECh. 5 - Prob. 25RECh. 5 - Prob. 26RECh. 5 - Count the number of vertices, edges, and faces in...Ch. 5 - Count the number of vertices, edges, and faces in...Ch. 5 - Prob. 29RECh. 5 - Prob. 30RECh. 5 - Prob. 31RECh. 5 - Prob. 32RECh. 5 - Prob. 33RECh. 5 - Prob. 34RECh. 5 - Scheduling A company has scheduled a retreat at a...Ch. 5 - Social Network Each vertex in the graph at the...Ch. 5 - Determine whether the following two graphs are...Ch. 5 - Answer the following questions for the graph shown...Ch. 5 - Recreation The illustration below depicts bridges...Ch. 5 - a. What does Dirac's theorem state? Explain how it...Ch. 5 - Low-Cost Route The table below shows the cost of...Ch. 5 - Use the greedy algorithm to find a Hamiltonian...Ch. 5 - Prob. 8TCh. 5 - Answer the following questions for the graph shown...Ch. 5 - Prob. 10TCh. 5 - Prob. 11TCh. 5 - A group of eight friends is planning a vacation in...
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