What happens if i increase the number of contracts

Assignment Help Basic Statistics
Reference no: EM13957199

Assume I am valuing the cash flows of a simple company with contracts 'a' through 'f' that have different varying cash flows over 10 years.

Probability of default for each contract a-f in any given year = 2.50%. Once there is a default, the cash flows cease and there is no ability to recover future cash flows. Defaults are not correlated.

What is the expected value of cash flows for each year? How do I model this?
Do we need to assume a normal distribution?

What happens if I increase the number of contracts?

What if two of the contracts had some correlation of defaults? Three contracts? Assume 25% correlation.

What is the expected value? How do I model this?

485_years.png


Attachment:- prob weighted cash flows.zip

Reference no: EM13957199

Questions Cloud

Determine the maximum power output : A Pelton impulse turbine has blades designed so that the direction of the incoming water jet with speed u is reversed. If the speed of the blades is u_c then, relative to the blade, the magnitude of the total change in the velocity of the jet is 2..
Provide examples for the traits of phonology and semantics : Given the information you gathered, write a short summary of the language you chose. Provide examples for the traits of phonology, semantics, and syntactics.
Cauchy-euler equation : 1. Find solutions to the given Cauchy- Euler equation
Purpose of studying phd statement : You need to write about the Purpose of studying PhD statement for applying King saud university.
What happens if i increase the number of contracts : Probability of default for each contract a-f in any given year = 2.50%. Once there is a default, the cash flows cease and there is no ability to recover future cash flows. Defaults are not correlated.
Give time at which the blood is moving with maximum velocity : The diagram below shows the acceleration of blood in the vasculature versus time in seconds. Give the time at which the blood is moving with the maximum velocity. Explain your answer.
What are the principal uses of a statement of cash flows : What are the principal uses of a statement of cash flows from the perspective of investors and company managers?
What is the annual impact of outsourcing payroll : What is the annual impact of outsourcing payroll? Will the company save money or spend extra money if payroll is outsourced?
What tricks noted by your colleagues might you adopt : How are you doing with memorizing the 10 knowledge areas and 47 processes? What tricks are you using to memorize the processes by process group? What tricks noted by your colleagues might you adopt?

Reviews

Write a Review

Basic Statistics Questions & Answers

  Statewide incidence of gonorrhea

The statewide incidence of gonorrhea is 50 per 100,000 over a 3 month period. Is the number of gonorrhea cases in this county unusual for this time period?

  Determine confidence interval for true percent of car owners

Determine the 95% confidence interval for true percent of car owners in this city who received the speeding ticket this year. Explain your results to nearest hundredth of percent.

  A student has been assigned 12 textbooks 3 for math 5 for

a student has been assigned 12 textbooks 3 for math 5 for music 4 for biology. she decides to keep all her books on one

  If the standard deviation for a population as estimated

if the standard deviation for a population as estimated from a sample is s 5.6 then the standard error for a sample

  You don''t have a population standard

You don't have a population standard deviation but you have sample data. Calculate a sample mean and standard deviation and use the sample standard deviation value to complete the inferential test.

  Several statistical tests have a way to measure effect size

several statistical tests have a way to measure effect size. what is this and when might you want to use it in looking

  Probability that only one of them is able to use spreadsheet

If one man and one woman are chosen randomly from the company, what is the probability that only one of them is able to use a spreadsheet?

  Hypothesis test-analysis of variance

To test whether or not there is a difference between treatments A, B, and C, a sample of 12 observations has been randomly assigned to the 3 treatments. You are given the results below.

  Let a be the number of rounds until lionel wins his first

lionel wants to play the crane machine arcade game the one with the mechanical claw to win a stuffed animal. he is good

  Show sampling distribution if a random sample is given

Show the sampling distribution of if a random sample of 150 insured individuals is used to estimate the proportion having received at least one ticket.

  A professor finds that the average sat score among all

a professor finds that the average sat score among all students attending his college is 1150plusmn150 ?plusmn?. he

  Probability regarding diet soda

If a woman purchases Super Cola, what is the probability that it is a diet soda?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd