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The Lognormal Distribution
If ln(X) is a normally distributed random variable, then X is said to be a lognormal variable.
If P1, P2, P3, ... are the prices of a scrip in periods 1, 2, 3, ..., some applications in finance require ln (P2/P1), ln (P3/P2),... to be normally distributed, that is, continuously compounded returns are required to be normal. This property is described as “Stock Prices are Lognormal”.
REMARK
The previous random variables arose out of natural experiments. The following distributions are derived distributions. That is, it is a function of other distributions. We require the following two distributions in Testing of Hypothesis. and our presentation will be restricted by our requirements.
in 1970 a record 1.5 of rain fell in one minute at Basse Terre, guadaloupe in the caribbnean.at this rate, how much rain fell in 3 seconds or 0.05 of a minutes?
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Combined Mean And Standard Deviation Occasionally we may need to combine 2 or more samples say A and B. Therefore it is essential to identify the new mean and the new standard
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Find the third vertex of a triangle if its two vertices are (-1, 4) and (5, 2) and mid point of one side is (0, 3).
solve for k such that the system 4x+ky=6 kx+y=-3
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