Random Investment. An investor has $100,000. If the current interest rate is i% (compounded continuously so that
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Random Investment. An investor has $100,000. If the current interest rate is i% (compounded continuously so that the grow per year is exp.i=100/), he invests his money in a i year CD, takes the profits and then reinvests the $100,000. Suppose that the kth investment leads to an interest rateXk which is uniform on f1; 2; 3; 4; 5g.
In the long run how much money does he make per year.
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