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Let S(t) be the price of a stock at time t in months. Assume that S(1)=10, S(2)=15, S(3)=20, S(4)=22, and S(5)=25. Long and Larry each
Let S(t) be the price of a stock at time t in months. Assume that S(1)=10, S(2)=15, S(3)=20, S(4)=22, and S(5)=25. Long and Larry each purchase 100 shares of the stock at time t=1. Long purchases 100 shares at each time, t=1,2,...,5. Larry uses dollar cost averaging each month, t=1,2,...,5.Who has made a greater profit at time t=5? Discuss this in terms of the Dollar Cost Averaging Theorem.
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