Lognormal distribution, Mathematics

Assignment Help:

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. 


Related Discussions:- Lognormal distribution

the demand forecast, The King Company is producing two types of products: ...

The King Company is producing two types of products: A and B. Both products are produced on the similar machining operation. The machines operate on two 8-hour shifts, 5 days per w

Sin[cot-1{cos(tan-1x)}], sin (cot -1 {cos (tan -1 x)}) tan -1 x = A  ...

sin (cot -1 {cos (tan -1 x)}) tan -1 x = A  => tan A =x sec A = √(1+x 2 ) ==>  cos A = 1/√(1+x 2 )    so   A =  cos -1 (1/√(1+x 2 )) sin (cot -1 {cos (tan -1 x)}) = s

Solving a quadratic equation, In polynomials you have seen expressi...

In polynomials you have seen expressions of the form x 2 + 3x - 4. Also we know that when an expression is equated to zero or some other expression, we cal

Simplify compound fractions, A compound fraction is a fraction that has oth...

A compound fraction is a fraction that has other fractions inside its numerator or denominator. Here's an example: While compound fractions can look really hairy, they're r

Mean value theorem find out all the numbers c, Find out all the numbers c t...

Find out all the numbers c that satisfy the conclusions of the Mean Value Theorem for the given function.                                               f ( x ) = x 3 + 2 x 2 -

#title.square footage, The area of a rectangular yard is 480 square feet. T...

The area of a rectangular yard is 480 square feet. The yard is 24 feet wide. How many feet do I need to fence all four sides?

Find the area of the rhombus, Show that the points (3, 0), (4, 5), (-1, 4) ...

Show that the points (3, 0), (4, 5), (-1, 4) and (-2, -1) taken in order are the vertices of a rhombus. Also find the area of the rhombus.

Elliptic paraboloid - three dimensional spaces, Elliptic Paraboloid Th...

Elliptic Paraboloid The equation which is given here is the equation of an elliptic paraboloid. x 2 /a 2 + y 2 /b 2 = z/c Like with cylinders this has a cross section

Vector calculus, If F ( x,y, z) = x y² y4 i + ( 2x2 y + z) j - y3 z² k, fin...

If F ( x,y, z) = x y² y4 i + ( 2x2 y + z) j - y3 z² k, find: i). question #Minimum 100 words accepted#

Finance, Determine the value of a $1800 investment after six years at 9.3% ...

Determine the value of a $1800 investment after six years at 9.3% per year, simple interest

Write Your Message!

Captcha
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