
A Problem Solving Approach To Mathematics For Elementary School Teachers (13th Edition)
13th Edition
ISBN: 9780135183885
Author: Rick Billstein, Shlomo Libeskind, Johnny Lott, Barbara Boschmans
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Question
Chapter 8.2, Problem 7MC
To determine
To respond:
To the statement “A student claims that the equation
Expert Solution & Answer

Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
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?
The Course Name Real Analysis please Solve questions by Real Analysis
Chapter 8 Solutions
A Problem Solving Approach To Mathematics For Elementary School Teachers (13th Edition)
Ch. 8.1 - Student were asked to write an algebraic...Ch. 8.1 - a. Choose seven consecutive term in any arithmetic...Ch. 8.1 - A teacher instructed her class as follows: Take...Ch. 8.1 - A teacher instructed her class to take any number...Ch. 8.1 - Give an example of geometric sequence whose first...Ch. 8.1 - Joel says that there is no reason to have more...Ch. 8.1 - A student wonders if sets can ever be considered...Ch. 8.1 - A student wants to know how can she prove that a...Ch. 8.1 - Prob. 9MCCh. 8.1 - Prob. 11MC
Ch. 8.1 - Prob. 1NAEPCh. 8.1 - 2+n 5 3+n 6 4+n 7 5+n 8 What number does n...Ch. 8.1 - Prob. 3NAEPCh. 8.1 - Melissa saves money for six weeks to buy a...Ch. 8.1A - Translate the following phrases into algebraic...Ch. 8.1A - Prob. 2ACh. 8.1A - In the tile pattern for an arithmetic sequence of...Ch. 8.1A - Prob. 4ACh. 8.1A - In a college, there are P professors and S...Ch. 8.1A - Suppose a class has g girls and b boys, and there...Ch. 8.1A - Ryan is building matchstick sequences as shown....Ch. 8.1A - Prob. 8ACh. 8.1A - For a particular event, a student pays 5 per...Ch. 8.1A - Prob. 10ACh. 8.1A - Prob. 11ACh. 8.1A - Prob. 12ACh. 8.1A - Find the first term and the difference in an...Ch. 8.1A - Prob. 14ACh. 8.1A - A ball is dropped from a height of 10 ft and...Ch. 8.1A - Jake bought contact lenses and was told to wear...Ch. 8.1A - Construct a Fibonacci-like sequence that is also...Ch. 8.1A - Prob. 18ACh. 8.1B - Translate the following phrases into algebraic...Ch. 8.1B - Prob. 2ACh. 8.1B - Discover a possible tile pattern in the following...Ch. 8.1B - In the following descriptions, write an expression...Ch. 8.1B - Prob. 5ACh. 8.1B - Suppose there are c chairs and t tables in a...Ch. 8.1B - Prob. 7ACh. 8.1B - Prob. 8ACh. 8.1B - Prob. 9ACh. 8.1B - Matt has twice as many as stickers as David. If...Ch. 8.1B - Prob. 11ACh. 8.1B - Prob. 12ACh. 8.1B - Find the first term and the difference in an...Ch. 8.1B - Find the first term in a geometric sequence if the...Ch. 8.1B - A ball is dropped from a height of 20 meters and...Ch. 8.1B - Consider the following arithmetic sequences....Ch. 8.1B - Prob. 18ACh. 8.2 - Students were asked to find three consecutive...Ch. 8.2 - Prob. 2MCCh. 8.2 - Create an equation with x on both sides of the...Ch. 8.2 - Prob. 4MCCh. 8.2 - Prob. 5MCCh. 8.2 - Prob. 6MCCh. 8.2 - Prob. 7MCCh. 8.2 - Prob. 8MCCh. 8.2 - A student was told that in order to check a...Ch. 8.2 - Prob. 10MCCh. 8.2 - Olivier said that his teacher would not accept 5=x...Ch. 8.2 - A student claimed that the equation 2x=3y has...Ch. 8.2 - Prob. 13MCCh. 8.2 - Prob. 14MCCh. 8.2 - Prob. 15MCCh. 8.2 - Prob. 16MCCh. 8.2 - Prob. 17MCCh. 8.2 - Prob. 18MCCh. 8.2 - Write an algebraic equation relating the variables...Ch. 8.2 - a. Show that the sum of every three consecutive...Ch. 8.2 - Prob. 21MCCh. 8.2 - Prob. 22MCCh. 8.2 - Prob. 1NAEPCh. 8.2 - Prob. 2NAEPCh. 8.2 - Archaeologists measure the lengths of certain...Ch. 8.2 - Jessica makes clay bowls. The following equation...Ch. 8.2A - Consider the balances: What is the value of each...Ch. 8.2A - Prob. 2ACh. 8.2A - Solve each of the following if x is a real number....Ch. 8.2A - Ryan is building a matchstick sequence so that one...Ch. 8.2A - For a particular event, 812 tickets were sold for...Ch. 8.2A - An estate of 486,000 is left to three siblings....Ch. 8.2A - A 10-ft board is to be cut into three pieces: two...Ch. 8.2A - Prob. 8ACh. 8.2A - Miriam is 10 years older than Ricardo. Two years...Ch. 8.2A - In a college, 20 times as many undergraduate...Ch. 8.2A - A farmer has 1200 yd of fencing to enclose a...Ch. 8.2A - The sum of three consecutive terms in the...Ch. 8.2A - Carlos bought 430 feet of fencing. With this, he...Ch. 8.2A - The sum of four consecutive natural numbers is...Ch. 8.2B - Consider the following balances: a. Which shape...Ch. 8.2B - Prob. 2ACh. 8.2B - Prob. 3ACh. 8.2B - Prob. 4ACh. 8.2B - Prob. 5ACh. 8.2B - Prob. 6ACh. 8.2B - Prob. 7ACh. 8.2B - Matt has twice as many stickers as David. How many...Ch. 8.2B - Prob. 9ACh. 8.2B - Prob. 10ACh. 8.2B - Prob. 11ACh. 8.2B - Prob. 12ACh. 8.2B - Prob. 13ACh. 8.3 - Prob. 1MCCh. 8.3 - Prob. 2MCCh. 8.3 - Prob. 4MCCh. 8.3 - Prob. 7MCCh. 8.3 - Prob. 8MCCh. 8.3 - Prob. 9MCCh. 8.3 - Prob. 10MCCh. 8.3 - Prob. 11MCCh. 8.3 - Prob. 12MCCh. 8.3 - Prob. 13MCCh. 8.3 - Prob. 14MCCh. 8.3 - Prob. 15MCCh. 8.3 - Prob. 16MCCh. 8.3 - Prob. 17MCCh. 8.3 - Prob. 18MCCh. 8.3 - Refer to the School Book page on page 456 and...Ch. 8.3 - Prob. 20MCCh. 8.3 - Prob. 21MCCh. 8.3 - Prob. 22MCCh. 8.3 - Prob. 23MCCh. 8.3 - Prob. 24MCCh. 8.3 - Prob. 1NAEPCh. 8.3 - Prob. 2NAEPCh. 8.3 - Prob. 3NAEPCh. 8.3A - Prob. 1ACh. 8.3A - Which of the following are function from the set...Ch. 8.3A - a. Draw an arrow diagram of a function with domain...Ch. 8.3A - Suppose f(x)=2x+1 and the domain {0,1,2,3,4}....Ch. 8.3A - Prob. 5ACh. 8.3A - a. Make an arrow diagram for each of the...Ch. 8.3A - The dosage of a certain drug is related to the...Ch. 8.3A - For each of the following, guess what might be...Ch. 8.3A - Quick-Talk advertises monthly cellualr...Ch. 8.3A - For each of the following sequenceseither...Ch. 8.3A - Consider the following two function machines. Find...Ch. 8.3A - In problem 11, find the all inputs for which the...Ch. 8.3A - a. Repeat exercise 11 when the bottom machine...Ch. 8.3A - Consider the function f(x)=x+b, where b is a...Ch. 8.3A - Let t(n) be the function that assigns the nth term...Ch. 8.3A - a. If f(x)=x2 and the output is 2, find all...Ch. 8.3A - Consider a function machine that accepts inputs as...Ch. 8.3A - The following graph shows the relationship between...Ch. 8.3A - A ball is shot out of a cannon at ground level....Ch. 8.3A - Prob. 20ACh. 8.3A - Prob. 21ACh. 8.3A - Which of the following equations or inequalities...Ch. 8.3A - Which of the following are graphs of fucntions and...Ch. 8.3B - The following sets of ordered pairs are functions....Ch. 8.3B - Prob. 2ACh. 8.3B - Prob. 4ACh. 8.3B - Prob. 5ACh. 8.3B - Prob. 6ACh. 8.3B - Prob. 7ACh. 8.3B - Prob. 8ACh. 8.3B - Prob. 9ACh. 8.3B - Prob. 10ACh. 8.3B - Prob. 11ACh. 8.3B - In problem 11, find the all inputs for which the...Ch. 8.3B - Prob. 13ACh. 8.3B - Prob. 14ACh. 8.3B - Prob. 15ACh. 8.3B - Prob. 16ACh. 8.3B - Prob. 17ACh. 8.3B - Prob. 18ACh. 8.3B - Prob. 19ACh. 8.3B - Prob. 20ACh. 8.3B - Prob. 21ACh. 8.3B - Prob. 22ACh. 8.3B - Prob. 23ACh. 8.4 - In this chapter, an arithmetic sequence was...Ch. 8.4 - Prob. 2MCCh. 8.4 - Prob. 3MCCh. 8.4 - Prob. 4MCCh. 8.4 - Prob. 5MCCh. 8.4 - Prob. 6MCCh. 8.4 - Prob. 7MCCh. 8.4 - Prob. 8MCCh. 8.4 - Prob. 9MCCh. 8.4 - Prob. 10MCCh. 8.4 - Janis noticed that in the simultaneous equations...Ch. 8.4 - Prob. 12MCCh. 8.4 - Prob. 13MCCh. 8.4 - Prob. 14MCCh. 8.4 - Prob. 15MCCh. 8.4 - Prob. 16MCCh. 8.4 - Prob. 17MCCh. 8.4 - Prob. 18MCCh. 8.4 - Prob. 19MCCh. 8.4 - Prob. 20MCCh. 8.4 - Prob. 1NAEPCh. 8.4 - Prob. 2NAEPCh. 8.4 - Prob. 3NAEPCh. 8.4 - Prob. 4NAEPCh. 8.4A - The graph of y=mx is given in the following...Ch. 8.4A - Prob. 2ACh. 8.4A - Find the x-intercept and y-intercept for the...Ch. 8.4A - Prob. 4ACh. 8.4A - Write each of the following equations in...Ch. 8.4A - For each of the following, write the equation of...Ch. 8.4A - Find the coordinates of two other collinear points...Ch. 8.4A - Prob. 8ACh. 8.4A - Prob. 9ACh. 8.4A - Find the equation for each of the following lines....Ch. 8.4A - For each of the following, find the slope, if...Ch. 8.4A - Write the equation of each line in exercise 11....Ch. 8.4A - Wildlife experts found that the number of chirps C...Ch. 8.4A - The lines AB and BC shown in the figure are graph...Ch. 8.4A - What do the graphs of the following equations have...Ch. 8.4A - Suppose a car is travelling at constant speed of...Ch. 8.4A - Solve each of the following systems, if possible....Ch. 8.4A - The owner of a 5000-gal oil truck loads the truck...Ch. 8.4A - Josephines bank contains 27 coins. If all the...Ch. 8.4B - Prob. 2ACh. 8.4B - ASSESSMENT 8-4B Find the x-intercept and...Ch. 8.4B - Prob. 4ACh. 8.4B - Prob. 5ACh. 8.4B - Prob. 6ACh. 8.4B - ASSESSMENT 8-4B Find the coordinates of two other...Ch. 8.4B - Prob. 8ACh. 8.4B - Prob. 9ACh. 8.4B - ASSESSMENT 8-4B Find the equation for each of the...Ch. 8.4B - ASSESSMENT 8-4B For each of the following, find...Ch. 8.4B - ASSESSMENT 8-4B Write the equation of each line in...Ch. 8.4B - Prob. 13ACh. 8.4B - Prob. 14ACh. 8.4B - Prob. 15ACh. 8.4B - Prob. 16ACh. 8.4B - Solve each of the following systems, if possible....Ch. 8.CR - Each of the following is a geometric sequence....Ch. 8.CR - Prob. 2CRCh. 8.CR - a. If the first two terms of an arithmetic...Ch. 8.CR - There are 13 times as many students as professors...Ch. 8.CR - Write a sentence that gives the same information...Ch. 8.CR - Write an equation to find the number of feet given...Ch. 8.CR - The sum of n whole numbers is S. If each number is...Ch. 8.CR - I am thinking a whole number. If I divide it by...Ch. 8.CR - a. Think of a number. Add 17. Double the result....Ch. 8.CR - Find all the values of x that satisfy the...Ch. 8.CR - Mike has 3 times as many baseball cards as Jordan,...Ch. 8.CR - Jeannie has 10 books overdue at the library. She...Ch. 8.CR - Three children deliver all the newspapers in a...Ch. 8.CR - Which of the following sets of ordered pairs are...Ch. 8.CR - Prob. 15CRCh. 8.CR - Prob. 16CRCh. 8.CR - Prob. 17CRCh. 8.CR - Prob. 18CRCh. 8.CR - Prob. 19CRCh. 8.CR - Prob. 20CRCh. 8.CR - Graph each of the following equations: a. y=-2x+5...Ch. 8.CR - Prob. 22CRCh. 8.CR - Solve the following equations if possible: a....Ch. 8 - NOW TRY THIS Noah has some white square tiles and...Ch. 8 - Prob. 2NTCh. 8 - NOW TRY THIS What are the values of and in...Ch. 8 - NOW TRY THIS Solve the Newspaper Delivery problem...Ch. 8 - NOW TRY THIS Determine which of the following are...Ch. 8 - NOW TRY THIS a. Use the slope formula to find the...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, subject and related others by exploring similar questions and additional content below.Similar questions
- We consider a 4-dimensional stock price model given (under P) by dẴ₁ = µ· Xt dt + йt · ΣdŴt where (W) is an n-dimensional Brownian motion, π = (0.02, 0.01, -0.02, 0.05), 0.2 0 0 0 0.3 0.4 0 0 Σ= -0.1 -4a За 0 0.2 0.4 -0.1 0.2) and a E R. We assume that ☑0 = (1, 1, 1, 1) and that the interest rate on the market is r = 0.02. (a) Give a condition on a that would make stock #3 be the one with largest volatility. (b) Find the diversification coefficient for this portfolio as a function of a. (c) Determine the maximum diversification coefficient d that you could reach by varying the value of a? 2arrow_forwardQuestion 1. Your manager asks you to explain why the Black-Scholes model may be inappro- priate for pricing options in practice. Give one reason that would substantiate this claim? Question 2. We consider stock #1 and stock #2 in the model of Problem 2. Your manager asks you to pick only one of them to invest in based on the model provided. Which one do you choose and why ? Question 3. Let (St) to be an asset modeled by the Black-Scholes SDE. Let Ft be the price at time t of a European put with maturity T and strike price K. Then, the discounted option price process (ert Ft) t20 is a martingale. True or False? (Explain your answer.) Question 4. You are considering pricing an American put option using a Black-Scholes model for the underlying stock. An explicit formula for the price doesn't exist. In just a few words (no more than 2 sentences), explain how you would proceed to price it. Question 5. We model a short rate with a Ho-Lee model drt = ln(1+t) dt +2dWt. Then the interest rate…arrow_forwardIn 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.)arrow_forward
- 3. Consider the polynomial equation 6-iz+7z² - iz³ +z = 0 for which the roots are 3i, -2i, -i, and i. (a) Verify the relations between this roots and the coefficients of the polynomial. (b) Find the annulus region in which the roots lie.arrow_forwardThe managing director of a consulting group has the accompanying monthly data on total overhead costs and professional labor hours to bill to clients. Complete parts a through c. Question content area bottom Part 1 a. Develop a simple linear regression model between billable hours and overhead costs. Overhead Costsequals=212495.2212495.2plus+left parenthesis 42.4857 right parenthesis42.485742.4857times×Billable Hours (Round the constant to one decimal place as needed. Round the coefficient to four decimal places as needed. Do not include the $ symbol in your answers.) Part 2 b. Interpret the coefficients of your regression model. Specifically, what does the fixed component of the model mean to the consulting firm? Interpret the fixed term, b 0b0, if appropriate. Choose the correct answer below. A. The value of b 0b0 is the predicted billable hours for an overhead cost of 0 dollars. B. It is not appropriate to interpret b 0b0, because its value…arrow_forward3. Consider the polynomial equation 6-iz+7z2-iz³ +z = 0 for which the roots are 3i, -2i, -i, and i. (a) Verify the relations between this roots and the coefficients of the polynomial. (b) Find the annulus region in which the roots lie.arrow_forward
- Write the equation of the trigonometric function shown in the graph. LO 5 4 3 2 1 y -5 -5 4 8 8 500 -1 -2 -3 -4 -5 x 5 15л 5л 25л 15л 35π 5л 4 8 2 8 4 8arrow_forwardc) Using only Laplace transforms solve the following Samuelson model given below i.e., the second order difference equation (where yt is national income): - Yt+2 6yt+1+5y₁ = 0, if y₁ = 0 for t < 0, and y₁ = 0, y₁ = 1 1-e-s You may use without proof that L-1[s(1-re-s)] = f(t) = r² for n ≤tarrow_forward5. 156 m/WXY = 59° 63 E 7. B E 101 C mFE = 6. 68° 8. C 17arrow_forwardScoring: MATH 15 FILING /10 COMPARISON /10 RULER I 13 Express EMPLOYMENT PROFESSIONALS NAME: SKILLS EVALUATION TEST- Light Industrial MATH-Solve the following problems. (Feel free to use a calculator.) DATE: 1. If you were asked to load 225 boxes onto a truck, and the boxes are crated, with each crate containing nine boxes, how many crates would you need to load? 2. Imagine you live only one mile from work and you decide to walk. If you walk four miles per hour, how long will it take you to walk one mile? 3. Add 3 feet 6 inches + 8 feet 2 inches + 4 inches + 2 feet 5 inches. 4. In a grocery store, steak costs $3.85 per pound. If you buy a three-pound steak and pay for it with a $20 bill, how much change will you get? 5. Add 8 minutes 32 seconds + 37 minutes 18 seconds + 15 seconds. FILING - In the space provided, write the number of the file cabinet where the company should be filed. Example: File Cabinet #4 Elson Co. File Cabinets: 1. Aa-Bb 3. Cg-Dz 5. Ga-Hz 7. La-Md 9. Na-Oz 2. Bc-Cf…arrow_forwardpart 3 of the question is: A power outage occurs 6 min after the ride started. Passengers must wait for their cage to be manually cranked into the lowest position in order to exit the ride. Sine function model: where h is the height of the last passenger above the ground measured in feet and t is the time of operation of the ride in minutes. What is the height of the last passenger at the moment of the power outage? Verify your answer by evaluating the sine function model. Will the last passenger to board the ride need to wait in order to exit the ride? Explain.arrow_forwardIf you were asked to load 225 boxes onto a truck, and the boxes are crated, with each crate containing nine boxes, how many crates would you need to load?arrow_forwardarrow_back_iosSEE MORE QUESTIONSarrow_forward_ios
Recommended textbooks for you
- Algebra: Structure And Method, Book 1AlgebraISBN:9780395977224Author:Richard G. Brown, Mary P. Dolciani, Robert H. Sorgenfrey, William L. ColePublisher:McDougal LittellElementary AlgebraAlgebraISBN:9780998625713Author:Lynn Marecek, MaryAnne Anthony-SmithPublisher:OpenStax - Rice University
- Big Ideas Math A Bridge To Success Algebra 1: Stu...AlgebraISBN:9781680331141Author:HOUGHTON MIFFLIN HARCOURTPublisher:Houghton Mifflin HarcourtHolt Mcdougal Larson Pre-algebra: Student Edition...AlgebraISBN:9780547587776Author:HOLT MCDOUGALPublisher:HOLT MCDOUGALAlgebra and Trigonometry (MindTap Course List)AlgebraISBN:9781305071742Author:James Stewart, Lothar Redlin, Saleem WatsonPublisher:Cengage Learning

Algebra: Structure And Method, Book 1
Algebra
ISBN:9780395977224
Author:Richard G. Brown, Mary P. Dolciani, Robert H. Sorgenfrey, William L. Cole
Publisher:McDougal Littell


Elementary Algebra
Algebra
ISBN:9780998625713
Author:Lynn Marecek, MaryAnne Anthony-Smith
Publisher:OpenStax - Rice University

Big Ideas Math A Bridge To Success Algebra 1: Stu...
Algebra
ISBN:9781680331141
Author:HOUGHTON MIFFLIN HARCOURT
Publisher:Houghton Mifflin Harcourt

Holt Mcdougal Larson Pre-algebra: Student Edition...
Algebra
ISBN:9780547587776
Author:HOLT MCDOUGAL
Publisher:HOLT MCDOUGAL

Algebra and Trigonometry (MindTap Course List)
Algebra
ISBN:9781305071742
Author:James Stewart, Lothar Redlin, Saleem Watson
Publisher:Cengage Learning
What is a Linear Equation in One Variable?; Author: Don't Memorise;https://www.youtube.com/watch?v=lDOYdBgtnjY;License: Standard YouTube License, CC-BY
Linear Equation | Solving Linear Equations | What is Linear Equation in one variable ?; Author: Najam Academy;https://www.youtube.com/watch?v=tHm3X_Ta_iE;License: Standard YouTube License, CC-BY