Answered step by step
Verified Expert Solution
Question
1 Approved Answer
The price of a share of a particular stock listed on the New York Stock Exchange is currently $41. The following probability distribution shows how
The price of a share of a particular stock listed on the New York Stock Exchange is currently $41. The following probability distribution shows how the price per share is expected to change over a three-month period:
Stock Price Change ($) | Probability |
---|---|
-2 | 0.05 |
-1 | 0.15 |
0 | 0.25 |
1 | 0.05 |
2 | 0.05 |
3 | 0.30 |
4 | 0.15 |
- Set up intervals of random numbers that can be used to generate the change in stock price over a three-month period. If required, round your answers to two decimal places.
Stock Price Change Probability Interval -2 0.05 fill in the blank 1 but less than fill in the blank 2 -1 0.15 fill in the blank 3 but less than fill in the blank 4 0 0.25 fill in the blank 5 but less than fill in the blank 6 +1 0.05 fill in the blank 7 but less than fill in the blank 8 +2 0.05 fill in the blank 9 but less than fill in the blank 10 +3 0.30 fill in the blank 11 but less than fill in the blank 12 +4 0.15 fill in the blank 13 but less than fill in the blank 14 - With the current price of $41 per share and the random numbers 0.4713, 0.8283, 0.0795 and 0.2089, simulate the price per share for the next four 3-month periods.
Random Number Price Change Ending Price Per Share 0.4713 fill in the blank 15 $ fill in the blank 16 0.8283 fill in the blank 17 $ fill in the blank 18 0.0795 fill in the blank 19 $ fill in the blank 20 0.2089 fill in the blank 21 $ fill in the blank 22
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started