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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.
Let a 0 , a 1 ::: be the series recursively defined by a 0 = 1, and an = 3 + a n-1 for n ≥ 1. (a) Compute a 1 , a 2 , a 3 and a 4 . (b) Compute a formula for an, n ≥ 0.
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When finding the limit as x approaches 0 the for function (square root of x^3 + x^2) cos(pi/2x) would the limit not exist because there would be a zero in the denominator?
y=f(a^x) and f(sinx)=lnx find dy/dx? Solution) dy/dx exist only when 0 1 as the function y = f(a^x) itself does not exist.
Reason for why limits not existing : In the previous section we saw two limits that did not. We saw that did not exist since the function did not settle down to a sing
Find the GCF of 70 and 112
nc6:n-3c3=91:4
a pizza driver delivered 27 pizzas in one night he delivered more then one pizza to only one house . every other house he only delivered pizza to 18 houses . how many pizzas did he
Add 1011 and 1101 in base 2
If you have 60% alcohol and wish to dilute with water to make 12 liters 40% alcohol, How many liters of water should you add?
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