Show that if E[x t ] = 0, we must have t = t .

Question:

Show that if E[Δx_t] = 0, we must have μ_t = −λ_tθ.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

A First Course in Quantitative Finance

ISBN: 978-1108419574

1st edition

Authors: Thomas Mazzoni

See More Books

Question Posted: Dec 26, 2018 10:25 AM

See More Questions

It is early Monday morning and Darryl Dawdle must write a term paper. Darryls instructor does not accept late papers and it is crucial for Darryl to meet the deadline. The paper is due on Thursday...
Raising Money for a Streetlight through a Subscription Campaign: Sometimes, a civil society institutions goal can be clearly articulated in terms of a dollar value that is needed. Consider, for...
We have illustrated in several settings the role of actuarially fair insurance contracts (b, p) (where b is the insurance benefit in the bad state and p is the insurance premium that has to be paid...
Asset allocation explains a large portion of a portfolio return. However, the implementation issues involved inthe asset allocation process may reduce the efficiency of the asset allocation strategy,...
Calvin purchased a 40% partnership interest for $43,000 in February 2014. His share of partnership income in 2014 was $22,000, in 2015 was $25,000, and in 2016 was $12,000. He made no additional...
How are businesses responding to the environmental issues facing society?
8. Under what circumstances would a foreign entitys financial statements need to be both remeasured and translated? Would this process have an effect on both the income statement and other...
The following is information for Dundee Realty: a. Balance per the bank statement dated October 31, 2014, is $26,830. b. Balance of the Cash account on the company books as of October 31, 2014, is...
please.. i dont have enough time, please.. No. 7.990 P3-SB On November 1, 2014, the account balances of Samone Equipment Repair, Inc. were as follows Debit No. Credit 101 Cash $ 2,400 158 Accumulated...
Pas Corporation acquired 80 percent of Sel Corporation's common stock on January 1, 2011, for $210,000 cash. The stockholders' equity of Sel at this time consisted of $150,000 capital stock and...
Find the Cartesian coordinates of the point whose cylindrical polar coordinates are = 25.00, = 60.0 , z = 17.50
Find the cylindrical polar coordinates of the point whose Cartesian coordinates are (2.000,2.000, 3.000).
1 What factors in the context including the history of the company or your personal experience have shaped the way you manage your attempts at influencing? Does your current approach appear to be...
The composition of moist air is given on a molar basis to be 78 percent N2, 20 percent O2, and 2 percent water vapor. Determine the mass fractions of the constituents of air. Use the table containing...
1. Consider the LFSR with so = 1, 8 = 1, S2 = 1, 83 = 1, 84 = 0, and Sn Sn-2 Sn-3+ Sn-5. Find the next 15 terms in this LFSR. What is the period of this LFSR? 2. Suppose you learn that a Hill cipher...
Assume that you are thinking of a new acquisition campaign for SEDO, assuming that you want to convert people who are already engaged. Develop a big idea (in the communication) that you can use in...
You have a backend Amazon EC2 instance providing a web service to your web server instances. Your web servers are in a public subnet. You would like to block inbound requests from the internet to...
Consider the following task set. Task C T|D T1 20 50 40 T2 10 40 30 T3 5 20 15 a) Verify whether the task set is schedulable under DM using the processor utilization-based ap- proach. b) Verify...
What is the difference between cash basis accounting and accrual basis accounting?
Explain how the graph of each function can be obtained from the graph of y = 1/x or y = 1/x 2 . Then graph f and give the (a) Domain (b) Range. Determine the largest open intervals of the domain over...
Angela forms a corporation during the current year to conduct her new business. The corporation is a C corporation, and Angela is its only shareholder. Is the corporation potentially subject to the...
Rick owns investments that generate $20,000 of ordinary income per year (4% annual before-tax rate of return). In each part, determine how much higher or lower Rick's after-tax income would be if he...
In the current year, Kennedy Corporation is deemed to be a PHC and reports the following results: Taxable income . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $400,000...
The following amounts were reported on the December 31, 2022, balance sheet: Cash $ 8,000 Land 20,000 Accounts payable 15,000 Bonds payable 120,000 Merchandise inventory 30,000 Retained earnings...
Sandhill Co. issued $ 600,000, 10-year, 8% bonds at 105. 1.Prepare the journal entry to record the sale of these bonds on January 1, 2017. (Credit account titles are automatically indented when the...
Based on the regression output (below), would you purchase this actively managed fund with a fee of 45bps ? Answer yes or no and one sentence to explain why.

Show that if E[x t ] = 0, we must have t = t .

Question:

Step by Step Answer:

Because z t has zero expectation t has to be t...View the full answer

A First Course in Quantitative Finance

Students also viewed these Business questions