The price of a share of a particular stock listed on the New York Stock Exchange

Question

The price of a share of a particular stock listed on the New York Stock Exchange is currently $44. The following probability distribution shows how the price per share is expected to change over a three-month period:

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.

With the current price of $44 per share and the random numbers 0.3257, 0.4191, 0.2797 and 0.7275, simulate the price per share for the next four 3-month periods.

What is the ending simulated price per share?

$  

Stock Price Change ($) Probability -1 0.20 0 0.20 1 0.10 2 0.05 3 0.25 4 0.05 5 0.15

Explanation / Answer

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.

the ending simulated price per share = 48

Stock Price Change Probability Interval -1 0.20 0 but less than 0.20 0 0.20 0.20 but less than 0.40 +1 0.10 0.40 but less than 0.50 +2 0.05 0.50 but less than 0.55 +3 0.25 0.55 but less than 0.80 +4 0.05 0.80 but less than 0.85 +5 0.15 0.85 but less than 1

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.