Exercise 7. Consider Example 7, Let It Ride. Go to let_it_ride_monte_carlo_simulation.xlsx. (a) What are the approximate chances that at the end of 10 years the investment is worth less than the initial $1000 ? (b) What are the approximate chances that the investment does not keep pace with a 3% inflation rate? That is, what are the approximate chances that the initial investment of $1000 is worth less than 1000(1+0.03)10=1343.916 dollars? (c) What are the approximate chances the initial investment of $1000 is worth more than $5000 at the end of the 10th year? (d) What is the approximate 10th percentile of X:RE ? Interpret this in words. (e) Give an 80% prediction interval for the worth of the investment after 10 years. Interpret this interval. Hint: Compute the 10th and 90th sample percentiles (do you see why?)... (f) If the worth of the investment after 10 years is $4000, what is the annualized return rate (\%)? That is, solve for r in the expression 1000(1+100r)10=4000. Exercise 7. Consider Example 7, Let It Ride. Go to let_it_ride_monte_carlo_simulation.xlsx. (a) What are the approximate chances that at the end of 10 years the investment is worth less than the initial $1000 ? (b) What are the approximate chances that the investment does not keep pace with a 3% inflation rate? That is, what are the approximate chances that the initial investment of $1000 is worth less than 1000(1+0.03)10=1343.916 dollars? (c) What are the approximate chances the initial investment of $1000 is worth more than $5000 at the end of the 10th year? (d) What is the approximate 10th percentile of X:RE ? Interpret this in words. (e) Give an 80% prediction interval for the worth of the investment after 10 years. Interpret this interval. Hint: Compute the 10th and 90th sample percentiles (do you see why?)... (f) If the worth of the investment after 10 years is $4000, what is the annualized return rate (\%)? That is, solve for r in the expression 1000(1+100r)10=4000