Explain lognormal stochastic differential equation
Explain lognormal stochastic differential equation for evolution of an asset.
Expert
One of the beginning points for typical derivatives theory is the lognormal stochastic differential equation for evolution of a certain asset. Itoˆ’s lemma defines the stochastic differential equation for value of an option on such asset. In mathematical terms, when we have a Wiener process X along with increments dX which are normally distributed along with mean zero and variance dt, in that case the increment of a function F(X) is specified by
dF = (dF/dX) dX + ½ (d2F/dX2) dt
It is a very loose dentition of Itˆ o’s lemma but it will suffice.
The Bolzano-Weierstrass property does not hold in C[0, ¶] for the infinite set A ={sinnx:n<N} : A is infinite; Show that has no “ limit points”.
Non-Logical Vocabulary: 1. Predicates, called also relation symbols, each with its associated arity. For our needs, we may assume that the number of predicates is finite. But this is not essential. We can have an infinite list of predicates, P
Specify the important properties for the polynomial.
How can we say that the pair (G, o) is a group. Explain the properties which proof it.
An oil company blends two input streams of crude oil products alkylate and catalytic cracked to meet demand for weekly contracts for regular (12,000 barrels) mind grade ( 7,500) and premium ( 4,500 barrels) gasoline’s . each week they can purchase up to 15, 000
Prove the law of iterated expectations for continuous random variables. 2. Prove that the bounds in Chebyshev's theorem cannot be improved upon. I.e., provide a distribution that satisfies the bounds exactly for k ≥1, show that it satisfies the bounds exactly, and draw its PDF. T
this assignment contains two parts theoretical and coding the code has to be a new. old code and modified code will appear in the university website .
complete assignment with clear solution and explanation
For queries Q1 and Q2, we say Q1 is containedin Q2, denoted Q1 C Q2, iff Q1(D) C Q2
II. Prove that Set Theory is a Model of a Boolean Algebra The three Boolean operations of Set Theory are the three set operations of union (U), intersection (upside down U), and complement ~. Addition is set
18,76,764
1923337 Asked
3,689
Active Tutors
1432478
Questions Answered
Start Excelling in your courses, Ask an Expert and get answers for your homework and assignments!!