Introductory Statistics
3rd Edition
ISBN: 9780135188927
Author: Gould, Robert, Ryan, Colleen N. (colleen Nooter)
Publisher: Pearson,
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Chapter 7, Problem 84SE
Preschool: Just the Girls The Perry Preschool Project was created in the early 1960s by David Weikart in Ypsilanti, Michigan. In this project, 123 African American children were randomly assigned to one of two groups: One group enrolled in the Perry Preschool, and one group did not enroll. Follow-up studies were done for decades. One research question was whether attendance at preschool had an effect on high school graduation. The table shows whether the students graduated from regular high school or not and includes girls only (Schweinhart et al. 2005).
a. Find the percentages that graduated for both groups, and compare them descriptively. Does this suggest that preschool was associated with a higher graduation rate?
b. Which of the conditions fail so that we cannot use a confidence interval for the difference between proportions?
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Problem1
We consider a two-period binomial model with the following properties: each period lastsone (1) year and the current stock price is S0 = 4. On each period, the stock price doubleswhen it moves up and is reduced by half when it moves down. The annual interest rateon the money market is 25%. (This model is the same as in Prob. 1 of HW#2).We consider four options on this market: A European call option with maturity T = 2 years and strike price K = 5; A European put option with maturity T = 2 years and strike price K = 5; An American call option with maturity T = 2 years and strike price K = 5; An American put option with maturity T = 2 years and strike price K = 5.(a) Find the price at time 0 of both European options.(b) Find the price at time 0 of both American options. Compare your results with (a)and comment.(c) For each of the American options, describe the optimal exercising strategy.
Problem 1.We consider a two-period binomial model with the following properties: each period lastsone (1) year and the current stock price is S0 = 4. On each period, the stock price doubleswhen it moves up and is reduced by half when it moves down. The annual interest rateon the money market is 25%.
We consider four options on this market: A European call option with maturity T = 2 years and strike price K = 5; A European put option with maturity T = 2 years and strike price K = 5; An American call option with maturity T = 2 years and strike price K = 5; An American put option with maturity T = 2 years and strike price K = 5.(a) Find the price at time 0 of both European options.(b) Find the price at time 0 of both American options. Compare your results with (a)and comment.(c) For each of the American options, describe the optimal exercising strategy.(d) We assume that you sell the American put to a market participant A for the pricefound in (b). Explain how you act on the market…
What is the standard scores associated to the left of z is 0.1446
Chapter 7 Solutions
Introductory Statistics
Ch. 7 - Population vs. Sample (Example 1) In 2017 the...Ch. 7 - Population vs. Sample In 2017 Pew Research Center...Ch. 7 - Parameter vs. Statistic (Example 2) Bob Ross...Ch. 7 - Parameter vs. Statistic The website...Ch. 7 - x vs. Two symbols are used for the mean: and x....Ch. 7 - vs. s Two symbols are used for the standard...Ch. 7 - vs. x The mean weight of all professional NBA...Ch. 7 - vs. s The standard deviation of all professional...Ch. 7 - Notation (Example 3) The city of San Francisco...Ch. 7 - Notation The city of Chicago provides an open data...
Ch. 7 - Samples and Populations (Example 4) Chapman...Ch. 7 - Samples and Populations The Centers for Disease...Ch. 7 - Sample vs. Census You are receiving a large...Ch. 7 - Sampling GPAs Suppose you want to estimate the...Ch. 7 - Sampling with and without Replacement Explain the...Ch. 7 - Simple Random Sampling Is simple random sampling...Ch. 7 - Finding a Random Sample (Example 5) You need to...Ch. 7 - Finding a Random Sample You need to select a...Ch. 7 - Random Sampling Assume your class has 30 students...Ch. 7 - Random Sampling with Coins Assume your class has...Ch. 7 - Survey Response (Example 6) A school district...Ch. 7 - Survey Response To determine if patrons are...Ch. 7 - Views on Capital Punishment In carrying out a...Ch. 7 - Views on Capital Punishment Use the data given in...Ch. 7 - Targets: Bias or Lack of Precision? a. If a...Ch. 7 - Targets: Bias or Lack of Precision, Again a. If a...Ch. 7 - Bias? Suppose that, when taking a random sample of...Ch. 7 - Unbiased Sample? Suppose you attend a school that...Ch. 7 - Proportion of Odd Digits A large collection of...Ch. 7 - Proportion of Odd Digits...Ch. 7 - Prob. 31SECh. 7 - Prob. 32SECh. 7 - ESP A Zener deck of cards has cards that show one...Ch. 7 - ESP Again In the graphs for Exercise 7.33, explain...Ch. 7 - Standard Error Which of the dotplots given in...Ch. 7 - Bias? Assuming that the true proportion of success...Ch. 7 - Fair Coin? One of the graphs shows the proportion...Ch. 7 - Far from Fair Which of the graphs in Exercise 7.37...Ch. 7 - Variation in Sample Proportions (Example 7)...Ch. 7 - Variation in Sample Proportions Suppose it is...Ch. 7 - Driver’s License (Example 8) According to a 2017...Ch. 7 - BA Attainment According to a 2017 Pew Research...Ch. 7 - Stress (Example 9) According to a 2017 Gallup...Ch. 7 - Prob. 44SECh. 7 - Streaming Services (Example 10) According to a...Ch. 7 - Prob. 46SECh. 7 - Voting According to a 2017 Pew Research Center...Ch. 7 - Instagram According to a 2018 Pew Research Center...Ch. 7 - Super Bowl In 2018 it was estimated that...Ch. 7 - College Enrollment According to data released in...Ch. 7 - Color Blindness While the majority of people who...Ch. 7 - Blood Type Human blood is divided into 8 possible...Ch. 7 - Prob. 53SECh. 7 - Environment A 2017 Gallup poll found that 601 out...Ch. 7 - Gun Control According to a 2017 Gallup Poll, 617...Ch. 7 - Smokers According to a 2017 Gallup poll, 572 out...Ch. 7 - Voting A random sample of likely voters showed...Ch. 7 - Voting A random sample of likely voters showed...Ch. 7 - Prob. 59SECh. 7 - Diabetes In a simple random sample of 1200...Ch. 7 - Marijuana Legalization A 2017 Gallup poll reported...Ch. 7 - Organic Produce A 2016 Pew Research poll found...Ch. 7 - Democracy and Unpopular Views A 2017 survey of...Ch. 7 - Democracy and Free Press A 2017 survey of U.S....Ch. 7 - Winter Olympics (Example 12) According to a 2018...Ch. 7 - Marijuana Use The Gallup poll reported that 45 of...Ch. 7 - Past Presidential Vote In the 1960 presidential...Ch. 7 - Batting Averages The website www.mlb.com compiles...Ch. 7 - Picky Eaters (Example 13) In a 2017 Harris poll...Ch. 7 - Nutrition Labels Of 1019 U.S. adults responding to...Ch. 7 - Prob. 71SECh. 7 - Estimating Sample Size In the 2018 study Closing...Ch. 7 - Happiness A Harris poll asked Americans in 2016...Ch. 7 - Artificial Intelligence A Harris poll asked a...Ch. 7 - Democratic (Examples 15, 16, 17, 18) Voters and...Ch. 7 - Trust in Judiciary In 2016 and 2017 Gallup asked...Ch. 7 - Perry Preschool and Graduation from High School...Ch. 7 - Preschool: Just the Boys Refer to Exercise 7.77...Ch. 7 - Prob. 79SECh. 7 - Sugar-Sweetened Beverages In 2017, the journal...Ch. 7 - Gender and Use of Turn Signals Statistics student...Ch. 7 - Local TV News Pew Research reported that 46 of...Ch. 7 - Drug for Nausea Ondansetron (Zofran) is a drug...Ch. 7 - Preschool: Just the Girls The Perry Preschool...Ch. 7 - Prob. 85CRECh. 7 - College Enrollment (Women) According to the Bureau...Ch. 7 - Prob. 87CRECh. 7 - Technology Anxiety In a 2018 survey conducted by...Ch. 7 - Sample Proportion A poll on a proposition showed...Ch. 7 - Sample Proportion A poll on a proposition showed...Ch. 7 - Margin of Error A poll on a proposition showed...Ch. 7 - Margin of Error A poll on a proposition showed...Ch. 7 - Dreaming in Color According to studies done in the...Ch. 7 - Hand Washing Ignaz Semmelweiss (1818-1865) was the...Ch. 7 - Prob. 95CRECh. 7 - School Bond Suppose a political consultant is...Ch. 7 - Prob. 97CRECh. 7 - Prob. 98CRECh. 7 - Voters Poll: Sample Size A polling agency wants to...Ch. 7 - Ratio of Sample Sizes Find the sample size...Ch. 7 - Criticize the Sampling Marco is interested in...Ch. 7 - Criticize the Sampling Maria opposes capital...Ch. 7 - Random Sampling? If you walked around your school...Ch. 7 - Biased Sample? You want to find the mean weight of...Ch. 7 - Bias? Suppose that, when taking a random sample of...Ch. 7 - Bias? Four women selected from a photo of 123 were...Ch. 7 - Sample Size Formula (Part 1) From Formula 7.2, an...Ch. 7 - Sample Size Formula (Part 2) Using your result...
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