Elementary Statistics Using Excel (6th Edition)
6th Edition
ISBN: 9780134506623
Author: Mario F. Triola
Publisher: PEARSON
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Chapter 5, Problem 4CRE
a.
To determine
The number of HR Professionals who said that their companies do criminal background checks for all the job applicants.
b.
To determine
To identify: Whether the 347 human resource professionals represents the population or the sample
c.
To determine
To identify: Whether the value of 73% is a statistic or a parameter
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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 5 Solutions
Elementary Statistics Using Excel (6th Edition)
Ch. 5.1 - 1. Random Variable The accompanying table lists...Ch. 5.1 - 2. Discrete or Continuous? Is the random variable...Ch. 5.1 - 3. Probability Distribution For the accompanying...Ch. 5.1 - Prob. 4BSCCh. 5.1 - Identifying Discrete and Continuous Random...Ch. 5.1 - Identifying Discrete and Continuous Random...Ch. 5.1 - Prob. 7BSCCh. 5.1 - Identifying Probability Distributions. In...Ch. 5.1 - Prob. 9BSCCh. 5.1 - Prob. 10BSC
Ch. 5.1 - Prob. 11BSCCh. 5.1 - Prob. 12BSCCh. 5.1 - Identifying Probability Distributions. In...Ch. 5.1 - Prob. 14BSCCh. 5.1 - Prob. 15BSCCh. 5.1 - Prob. 16BSCCh. 5.1 - Prob. 17BSCCh. 5.1 - Genetics. In Exercises 15–20, refer to the...Ch. 5.1 - Genetics. In Exercises 15–20, refer to the...Ch. 5.1 - Prob. 20BSCCh. 5.1 - Sleepwalking. In Exercises 21–25, refer to the...Ch. 5.1 - Prob. 22BSCCh. 5.1 - Prob. 23BSCCh. 5.1 - Sleepwalking. In Exercises 21–25, refer to the...Ch. 5.1 - Sleepwalking. In Exercises 21–25, refer to the...Ch. 5.1 - Prob. 26BBCh. 5.1 - Prob. 27BBCh. 5.1 - 28. Expected Value in Roulette When playing...Ch. 5.1 - Prob. 29BBCh. 5.1 - Prob. 30BBCh. 5.2 - 1. Drone Deliveries Based on a Pitney Bowes...Ch. 5.2 - Prob. 2BSCCh. 5.2 - 3. Independent Events Based on a Pitney Bowes...Ch. 5.2 - Prob. 4BSCCh. 5.2 - Prob. 5BSCCh. 5.2 - Prob. 6BSCCh. 5.2 - Prob. 7BSCCh. 5.2 - Prob. 8BSCCh. 5.2 - Prob. 9BSCCh. 5.2 - Prob. 10BSCCh. 5.2 - Identifying Binomial Distributions. In Exercises...Ch. 5.2 - Prob. 12BSCCh. 5.2 - Prob. 13BSCCh. 5.2 - Prob. 14BSCCh. 5.2 - Prob. 15BSCCh. 5.2 - Prob. 16BSCCh. 5.2 - SAT Test. In Exercises 15–20, assume that random...Ch. 5.2 - Prob. 18BSCCh. 5.2 - Prob. 19BSCCh. 5.2 - SAT Test. In Exercises 15–20, assume that random...Ch. 5.2 - Prob. 21BSCCh. 5.2 - Prob. 22BSCCh. 5.2 - Prob. 23BSCCh. 5.2 - Prob. 24BSCCh. 5.2 - 25. Whitus v. Georgia In the classic legal case of...Ch. 5.2 - Prob. 26BSCCh. 5.2 - Prob. 27BSCCh. 5.2 - Prob. 28BSCCh. 5.2 - Prob. 29BSCCh. 5.2 - Prob. 30BSCCh. 5.2 - Prob. 31BSCCh. 5.2 - Prob. 32BSCCh. 5.2 - Prob. 33BSCCh. 5.2 - Prob. 34BSCCh. 5.2 - Acceptance Sampling. Exercises 35 and 36 involve...Ch. 5.2 - Prob. 36BSCCh. 5.2 - Prob. 37BSCCh. 5.2 - Prob. 38BSCCh. 5.2 - Prob. 39BSCCh. 5.2 - Prob. 40BSCCh. 5.2 - Prob. 41BBCh. 5.2 - Prob. 42BBCh. 5.2 - Prob. 43BBCh. 5.3 - 1. Notation In analyzing hits by V-1 buzz bombs in...Ch. 5.3 - 2. Tornadoes During a recent 64-year period, New...Ch. 5.3 - 3. Poisson Probability Distribution The random...Ch. 5.3 - Prob. 4BSCCh. 5.3 - Hurricanes. In Exercises 5–8, assume that the...Ch. 5.3 - 6. Hurricanes
a. Find the probability that in a...Ch. 5.3 - 7. Hurricanes
a. Find the probability that in a...Ch. 5.3 - 8. Hurricanes
a. Find the probability that in a...Ch. 5.3 - In Exercises 9–16, use the Poisson distribution to...Ch. 5.3 - 10. Murders In a recent year, there were 333...Ch. 5.3 - 11. Radioactive Decay Radioactive atoms are...Ch. 5.3 - 12. Deaths from Horse Kicks A classical example of...Ch. 5.3 - 13. World War II Bombs In Exercise 1“Notation” we...Ch. 5.3 - Prob. 14BSCCh. 5.3 - Prob. 15BSCCh. 5.3 - Prob. 16BSCCh. 5.3 - Prob. 17BBCh. 5 - Prob. 1CQQCh. 5 - Prob. 2CQQCh. 5 - 3. Are the values Found in Exercise 2 statistics...Ch. 5 - Prob. 4CQQCh. 5 - Prob. 5CQQCh. 5 - Prob. 6CQQCh. 5 - Prob. 7CQQCh. 5 - Prob. 8CQQCh. 5 - Prob. 9CQQCh. 5 - Prob. 10CQQCh. 5 - Prob. 1RECh. 5 - Prob. 2RECh. 5 - Prob. 3RECh. 5 - Prob. 4RECh. 5 - Prob. 5RECh. 5 - Prob. 6RECh. 5 - Prob. 7RECh. 5 - Prob. 8RECh. 5 - Prob. 9RECh. 5 - Prob. 10RECh. 5 - 1. Planets The planets of the solar system have...Ch. 5 - Prob. 2CRECh. 5 - Prob. 3CRECh. 5 - Prob. 4CRECh. 5 - Prob. 5CRECh. 5 - 6. Washing Hands Based on results from a Bradley...Ch. 5 - Overbooking Flights American Airlines Flight 171...Ch. 5 - Prob. 1FDD
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