
EBK NATURE OF MATHEMATICS
13th Edition
ISBN: 9781305855588
Author: SMITH
Publisher: CENGAGE CO
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Question
Chapter 7.6, Problem 49PS
To determine
(a)
To explain:
A great circle on a sphere.
To determine
(b)
Whether one or both of the lettered curves in the figure at the right below seem to be lines.
To determine
(c)
Whether the property “A line has no endpoints” apply to the lines on a sphere.
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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
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D
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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.)
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 7 Solutions
EBK NATURE OF MATHEMATICS
Ch. 7.1 - Is the woman in the figure a young woman or an old...Ch. 7.1 - Is the fly in the Figure 7.11 on the cube or in...Ch. 7.1 - Prob. 3PSCh. 7.1 - Prob. 4PSCh. 7.1 - Prob. 5PSCh. 7.1 - Prob. 6PSCh. 7.1 - Prob. 7PSCh. 7.1 - Prob. 8PSCh. 7.1 - Prob. 9PSCh. 7.1 - Prob. 10PS
Ch. 7.1 - Prob. 11PSCh. 7.1 - Prob. 12PSCh. 7.1 - Prob. 13PSCh. 7.1 - Prob. 14PSCh. 7.1 - Prob. 15PSCh. 7.1 - Prob. 16PSCh. 7.1 - Prob. 17PSCh. 7.1 - Prob. 18PSCh. 7.1 - Use the illustration in Figure 7.12 to draw the...Ch. 7.1 - Prob. 20PSCh. 7.1 - Prob. 21PSCh. 7.1 - Prob. 22PSCh. 7.1 - Prob. 23PSCh. 7.1 - Prob. 24PSCh. 7.1 - Prob. 25PSCh. 7.1 - Prob. 26PSCh. 7.1 - Prob. 27PSCh. 7.1 - Carry out the constructions requested in Problems...Ch. 7.1 - Prob. 29PSCh. 7.1 - Prob. 30PSCh. 7.1 - Prob. 31PSCh. 7.1 - Prob. 32PSCh. 7.1 - Prob. 33PSCh. 7.1 - Prob. 34PSCh. 7.1 - Prob. 35PSCh. 7.1 - Prob. 36PSCh. 7.1 - Prob. 37PSCh. 7.1 - Prob. 38PSCh. 7.1 - Prob. 39PSCh. 7.1 - Prob. 40PSCh. 7.1 - Prob. 41PSCh. 7.1 - Prob. 42PSCh. 7.1 - Prob. 43PSCh. 7.1 - Prob. 44PSCh. 7.1 - Prob. 45PSCh. 7.1 - Prob. 46PSCh. 7.1 - Prob. 47PSCh. 7.1 - Prob. 48PSCh. 7.1 - Prob. 49PSCh. 7.1 - Prob. 50PSCh. 7.1 - Prob. 51PSCh. 7.1 - Study the patterns shown in Figure 7.13. When...Ch. 7.1 - Prob. 53PSCh. 7.1 - Prob. 54PSCh. 7.1 - Prob. 55PSCh. 7.1 - Prob. 56PSCh. 7.1 - Prob. 57PSCh. 7.1 - Prob. 58PSCh. 7.1 - The letters of the alphabet can be sorted into the...Ch. 7.1 - Prob. 60PSCh. 7.2 - Prob. 1PSCh. 7.2 - Prob. 2PSCh. 7.2 - Prob. 3PSCh. 7.2 - Prob. 4PSCh. 7.2 - Prob. 5PSCh. 7.2 - Prob. 6PSCh. 7.2 - Prob. 7PSCh. 7.2 - Prob. 8PSCh. 7.2 - Prob. 9PSCh. 7.2 - Prob. 10PSCh. 7.2 - Prob. 11PSCh. 7.2 - Prob. 12PSCh. 7.2 - Determine whether each sentence in Problems 11 14...Ch. 7.2 - Prob. 14PSCh. 7.2 - Prob. 15PSCh. 7.2 - Prob. 16PSCh. 7.2 - Prob. 17PSCh. 7.2 - Prob. 18PSCh. 7.2 - Prob. 19PSCh. 7.2 - Prob. 20PSCh. 7.2 - Prob. 21PSCh. 7.2 - Prob. 22PSCh. 7.2 - Prob. 23PSCh. 7.2 - Prob. 24PSCh. 7.2 - In Problems 25 32, classify the pairs of angles...Ch. 7.2 - Prob. 26PSCh. 7.2 - Prob. 27PSCh. 7.2 - Prob. 28PSCh. 7.2 - In Problems 25 32, classify the pairs of angles...Ch. 7.2 - Prob. 30PSCh. 7.2 - Prob. 31PSCh. 7.2 - Prob. 32PSCh. 7.2 - Prob. 33PSCh. 7.2 - Prob. 34PSCh. 7.2 - Prob. 35PSCh. 7.2 - Prob. 36PSCh. 7.2 - Prob. 37PSCh. 7.2 - Prob. 38PSCh. 7.2 - Prob. 39PSCh. 7.2 - Prob. 40PSCh. 7.2 - Prob. 41PSCh. 7.2 - Prob. 42PSCh. 7.2 - Prob. 43PSCh. 7.2 - Prob. 44PSCh. 7.2 - Prob. 45PSCh. 7.2 - Prob. 46PSCh. 7.2 - Prob. 47PSCh. 7.2 - Prob. 48PSCh. 7.2 - Prob. 49PSCh. 7.2 - Prob. 50PSCh. 7.2 - Prob. 51PSCh. 7.2 - In Problems 52 57, find the measures of all the...Ch. 7.2 - Prob. 53PSCh. 7.2 - Prob. 54PSCh. 7.2 - Prob. 55PSCh. 7.2 - Prob. 56PSCh. 7.2 - Prob. 57PSCh. 7.2 - Prob. 58PSCh. 7.2 - Prob. 59PSCh. 7.2 - Historical Quest: Allow me to start you on a...Ch. 7.3 - IN YOUR OWN WORDS What is a triangle?Ch. 7.3 - Prob. 2PSCh. 7.3 - IN YOUR OWN WORDS Explain the notation ABCDEF.Ch. 7.3 - Prob. 4PSCh. 7.3 - Prob. 5PSCh. 7.3 - Prob. 6PSCh. 7.3 - Prob. 7PSCh. 7.3 - Prob. 8PSCh. 7.3 - Prob. 9PSCh. 7.3 - Name the corresponding parts of the triangles in...Ch. 7.3 - In Problems 11-16, find the measure of the third...Ch. 7.3 - Prob. 12PSCh. 7.3 - Prob. 13PSCh. 7.3 - Prob. 14PSCh. 7.3 - Prob. 15PSCh. 7.3 - Prob. 16PSCh. 7.3 - Prob. 17PSCh. 7.3 - Prob. 18PSCh. 7.3 - Prob. 19PSCh. 7.3 - Prob. 20PSCh. 7.3 - Prob. 21PSCh. 7.3 - Prob. 22PSCh. 7.3 - Prob. 23PSCh. 7.3 - Prob. 24PSCh. 7.3 - Prob. 25PSCh. 7.3 - Prob. 26PSCh. 7.3 - Prob. 27PSCh. 7.3 - Prob. 28PSCh. 7.3 - Prob. 29PSCh. 7.3 - Prob. 30PSCh. 7.3 - Prob. 31PSCh. 7.3 - Prob. 32PSCh. 7.3 - Prob. 33PSCh. 7.3 - Prob. 34PSCh. 7.3 - Use algebra to find the value of x in each of the...Ch. 7.3 - Prob. 36PSCh. 7.3 - Prob. 37PSCh. 7.3 - Use algebra to find the value of x in each of the...Ch. 7.3 - Prob. 39PSCh. 7.3 - Prob. 40PSCh. 7.3 - Prob. 41PSCh. 7.3 - Prob. 42PSCh. 7.3 - Prob. 43PSCh. 7.3 - Prob. 44PSCh. 7.3 - Prob. 45PSCh. 7.3 - Prob. 46PSCh. 7.3 - Prob. 47PSCh. 7.3 - Prob. 48PSCh. 7.3 - Prob. 49PSCh. 7.3 - Prob. 50PSCh. 7.3 - Prob. 51PSCh. 7.3 - Prob. 52PSCh. 7.3 - Prob. 53PSCh. 7.3 - Prob. 54PSCh. 7.3 - Prob. 55PSCh. 7.3 - Prob. 56PSCh. 7.3 - The legs of a picnic table form a triangle where...Ch. 7.3 - Prob. 58PSCh. 7.3 - Prob. 59PSCh. 7.3 - Prob. 60PSCh. 7.4 - IN YOUR OWN WORDS Contrast congruent and similar...Ch. 7.4 - Prob. 2PSCh. 7.4 - In Problems 3-8, determine if the triangles are...Ch. 7.4 - Prob. 4PSCh. 7.4 - Prob. 5PSCh. 7.4 - Prob. 6PSCh. 7.4 - Prob. 7PSCh. 7.4 - Prob. 8PSCh. 7.4 - Prob. 9PSCh. 7.4 - Prob. 10PSCh. 7.4 - Prob. 11PSCh. 7.4 - Prob. 12PSCh. 7.4 - Prob. 13PSCh. 7.4 - Prob. 14PSCh. 7.4 - Prob. 15PSCh. 7.4 - Prob. 16PSCh. 7.4 - Prob. 17PSCh. 7.4 - Prob. 18PSCh. 7.4 - Prob. 19PSCh. 7.4 - Prob. 20PSCh. 7.4 - Prob. 21PSCh. 7.4 - Prob. 22PSCh. 7.4 - Prob. 23PSCh. 7.4 - Prob. 24PSCh. 7.4 - Prob. 25PSCh. 7.4 - Prob. 26PSCh. 7.4 - Prob. 27PSCh. 7.4 - Prob. 28PSCh. 7.4 - Prob. 29PSCh. 7.4 - Each figure in Problems 29-34 contains two similar...Ch. 7.4 - Prob. 31PSCh. 7.4 - Prob. 32PSCh. 7.4 - Prob. 33PSCh. 7.4 - Prob. 34PSCh. 7.4 - Prob. 35PSCh. 7.4 - Prob. 36PSCh. 7.4 - Given AC is perpendicular to MB, and ABC is an...Ch. 7.4 - Prob. 38PSCh. 7.4 - Prob. 39PSCh. 7.4 - Prob. 40PSCh. 7.4 - Use similar triangles and a proportion to find the...Ch. 7.4 - Prob. 42PSCh. 7.4 - Prob. 43PSCh. 7.4 - Prob. 44PSCh. 7.4 - Prob. 45PSCh. 7.4 - Prob. 46PSCh. 7.4 - A bell tower casts a shadow 45ft long. At the same...Ch. 7.4 - Prob. 48PSCh. 7.4 - Prob. 49PSCh. 7.4 - Prob. 50PSCh. 7.4 - Prob. 51PSCh. 7.4 - Prob. 52PSCh. 7.4 - Prob. 53PSCh. 7.4 - Prob. 54PSCh. 7.4 - Prob. 55PSCh. 7.4 - Suppose a 6- ft person wishes to determine the...Ch. 7.4 - Prob. 57PSCh. 7.4 - Prob. 58PSCh. 7.4 - Prob. 59PSCh. 7.4 - Prob. 60PSCh. 7.5 - Prob. 1PSCh. 7.5 - Prob. 2PSCh. 7.5 - Prob. 3PSCh. 7.5 - Prob. 4PSCh. 7.5 - Prob. 5PSCh. 7.5 - Prob. 6PSCh. 7.5 - Prob. 7PSCh. 7.5 - Prob. 8PSCh. 7.5 - Prob. 9PSCh. 7.5 - Prob. 10PSCh. 7.5 - Prob. 11PSCh. 7.5 - Prob. 12PSCh. 7.5 - Prob. 13PSCh. 7.5 - Prob. 14PSCh. 7.5 - Prob. 15PSCh. 7.5 - Prob. 16PSCh. 7.5 - Prob. 17PSCh. 7.5 - Prob. 18PSCh. 7.5 - Prob. 19PSCh. 7.5 - Prob. 20PSCh. 7.5 - Prob. 21PSCh. 7.5 - Prob. 22PSCh. 7.5 - Prob. 23PSCh. 7.5 - Prob. 24PSCh. 7.5 - Prob. 25PSCh. 7.5 - Prob. 26PSCh. 7.5 - Prob. 27PSCh. 7.5 - Prob. 28PSCh. 7.5 - Prob. 29PSCh. 7.5 - Prob. 30PSCh. 7.5 - Prob. 31PSCh. 7.5 - Prob. 32PSCh. 7.5 - Prob. 33PSCh. 7.5 - Prob. 34PSCh. 7.5 - Prob. 35PSCh. 7.5 - Prob. 36PSCh. 7.5 - Prob. 37PSCh. 7.5 - Prob. 38PSCh. 7.5 - Prob. 39PSCh. 7.5 - Prob. 40PSCh. 7.5 - Prob. 41PSCh. 7.5 - Prob. 42PSCh. 7.5 - Prob. 43PSCh. 7.5 - Prob. 44PSCh. 7.5 - Prob. 45PSCh. 7.5 - Prob. 46PSCh. 7.5 - Prob. 47PSCh. 7.5 - Level 2 If the angle from the horizontal to the...Ch. 7.5 - Prob. 49PSCh. 7.5 - Prob. 50PSCh. 7.5 - Prob. 51PSCh. 7.5 - Prob. 52PSCh. 7.5 - Prob. 53PSCh. 7.5 - Prob. 54PSCh. 7.5 - Prob. 55PSCh. 7.5 - Prob. 56PSCh. 7.5 - Prob. 57PSCh. 7.5 - Prob. 58PSCh. 7.5 - Prob. 59PSCh. 7.5 - Problem solving Level 3 a. If the distance from...Ch. 7.6 - Prob. 1PSCh. 7.6 - Prob. 2PSCh. 7.6 - Prob. 3PSCh. 7.6 - Prob. 4PSCh. 7.6 - Prob. 5PSCh. 7.6 - Prob. 6PSCh. 7.6 - Prob. 7PSCh. 7.6 - Prob. 8PSCh. 7.6 - Prob. 9PSCh. 7.6 - Prob. 10PSCh. 7.6 - Prob. 11PSCh. 7.6 - Prob. 12PSCh. 7.6 - Name the geometry Euclidean, elliptic, or...Ch. 7.6 - Prob. 14PSCh. 7.6 - Prob. 15PSCh. 7.6 - Prob. 16PSCh. 7.6 - Prob. 17PSCh. 7.6 - Prob. 18PSCh. 7.6 - Prob. 19PSCh. 7.6 - Prob. 20PSCh. 7.6 - Prob. 21PSCh. 7.6 - Prob. 22PSCh. 7.6 - Prob. 23PSCh. 7.6 - Prob. 24PSCh. 7.6 - Prob. 25PSCh. 7.6 - Prob. 26PSCh. 7.6 - Prob. 27PSCh. 7.6 - Prob. 28PSCh. 7.6 - Consider the top, front, and side views as shown...Ch. 7.6 - Prob. 30PSCh. 7.6 - Prob. 31PSCh. 7.6 - Prob. 32PSCh. 7.6 - Prob. 33PSCh. 7.6 - Prob. 34PSCh. 7.6 - Prob. 35PSCh. 7.6 - Prob. 36PSCh. 7.6 - Prob. 37PSCh. 7.6 - Prob. 38PSCh. 7.6 - Prob. 39PSCh. 7.6 - Prob. 40PSCh. 7.6 - Prob. 41PSCh. 7.6 - Prob. 42PSCh. 7.6 - Prob. 43PSCh. 7.6 - Prob. 44PSCh. 7.6 - Prob. 45PSCh. 7.6 - Prob. 46PSCh. 7.6 - Prob. 47PSCh. 7.6 - Prob. 48PSCh. 7.6 - Prob. 49PSCh. 7.6 - Prob. 50PSCh. 7.6 - Prob. 51PSCh. 7.6 - Prob. 52PSCh. 7.6 - Prob. 53PSCh. 7.6 - Prob. 54PSCh. 7.6 - When is an open book a closed book? If the...Ch. 7.6 - Prob. 56PSCh. 7.6 - Prob. 57PSCh. 7.6 - Prob. 58PSCh. 7.6 - Prob. 59PSCh. 7.CR - Prob. 1CRCh. 7.CR - Prob. 2CRCh. 7.CR - Prob. 3CRCh. 7.CR - Prob. 4CRCh. 7.CR - Prob. 5CRCh. 7.CR - Prob. 6CRCh. 7.CR - 7. Bourbon Palace Figure 7.77 is home to the...Ch. 7.CR - Prob. 8CRCh. 7.CR - Prob. 9CRCh. 7.CR - Prob. 10CRCh. 7.CR - Prob. 11CRCh. 7.CR - Prob. 12CRCh. 7.CR - Prob. 13CRCh. 7.CR - Prob. 14CRCh. 7.CR - Prob. 15CRCh. 7.CR - Prob. 16CRCh. 7.CR - Prob. 17CRCh. 7.CR - Prob. 18CRCh. 7.CR - Prob. 19CRCh. 7.CR - Prob. 20CR
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