1. A company has a cash portfolio measured in millions. The drift is 0.1 per month, variance is 0.16per month. The initial cash is 2.0. a) Find the probability distribution after 6 months and after 1 year. b) Find the probability of a negative cash position at the end of 6 months and the end of 1 year. c) At what time in the future is the probability of a negative distribution greatest.

Answers

Answer 1

Answer:

Step-by-step explanation:

From the information given:

The probability distribution at the end of 6 months is determined as follows:

After 6 months;

Mean of probability distribution =  value of Initial cash  + [tex]\alpha[/tex]T  

=2.0 +(0.1 × 6)

=2.6

After 6 months;

The probability distribution's standard deviation is estimated by using the following formula:

Standard deviation:

[tex]= b\sqrt{T}[/tex]

[tex]= 0.4 \times \sqrt{6}[/tex]

= 0.9798

Hence, after 6 months;

The company's cash position is supposed to be allocated monthly, with the following expenses.

Mean                            2.6

Standard deviation     0.9798

Variance                      0.96

After 12 months, the probability distribution is as follows:

Mean = value of Initial cash  + [tex]\alpha[/tex]T

= 2.0 +(0.1 × 12)

= 3.2

The standard deviation is:

The standard deviation of probability distribution = [tex]b \sqrt{T}[/tex]

[tex]= 0.4 \times \sqrt{12}[/tex]

= 1.3856

Hence, after 6 months;

The company's cash position is supposed to be allocated monthly, with the following expenses.

Mean                            3.2

Sandard deviation      1.3856

Variance                      1.92

b)  

in 6-month distribution, the probability of the negative value of the cash position is as follows.

Now, for us to find the negative cash distribution;

We need to estimate the z -scores value.

The z-score inform us greatly on the concept of how far a particular data point is from the mean.

For a normal distribution;

[tex]z = \dfrac{x-\mu}{\sigma}[/tex]

Here;

the value of x = zero as a result that if it exceeds zero. the cash position will be negative.

[tex]z = \dfrac{x-\mu}{\sigma}[/tex]

[tex]z = \dfrac{0 - 2.6}{0.9798}[/tex]

[tex]z = -2.6536[/tex]

Using the standard distribution tables, it is now possible to calculate that the likelihood N(-2.65) equals 0.004 or 0.4 percent.

As a result, there's a 0.4 percent chance of getting a negative cash balance after six months.

For 12 months distribution:

The Probability of negative cash position is calculated as follows:

[tex]z = \dfrac{x-\mu}{\sigma} \\ \\ z = \dfrac{0-3.2}{1.3856} \\ \\ z = -2.3094[/tex]

Using the standard distribution tables,

N(-2.31) equals 0.0104 or 1.04 percent.

As a result, there's a 1.04 percent chance of getting a negative cash balance after 1 year  

c) To determine the time period over which the likelihood of achieving a negative cash condition is highest, it's necessary to examine the z-score more closely. Essentially, the z-score measures the difference between a given value(x) and the mean of all potential values [tex](\mu)[/tex], expressed in terms of the total set's standard deviation [tex](\sigma)[/tex]

This suggests that the higher the z-score, the greater the difference occurring between x and [tex]\mu[/tex], and thus the likelihood of receiving x is minimal. As a result, the best chance of finding a certain value is when the z-score is the lowest.

To do so, calculate the derivative of the z-score in relation to the time interval. The point where the derivative is equivalent to zero is where the z-scores are at their lowest.

The first step is to go over the z-score formula in more detail, as seen below.;

[tex]z = \dfrac{x-\mu}{\sigma} \\ \\ z = \dfrac{0-(initial \ value + \alpha T)}{b \sqrt{T}} \\ \\ z = \dfrac{-initial \ value }{b\sqrt{T}}-\dfrac{a \sqrt{T}}{b} \\ \\[/tex]

Now, compute the derivative of this equation with respect to T as follows:

[tex]\dfrac{dz}{dT}= \dfrac{initial \ value \times T^{-\dfrac{3}{2}}}{2b} - \dfrac{aT^{-\dfrac{1}{2}}}{2b}[/tex]

Now, figure out the value of T at which this derivative is equal to zero by substituting all values as follows:

[tex]0 = \dfrac{2.0 \times T^{-\dfrac{3}{2}}}{2\times 0.4}- \dfrac{0.1 \times T^{-\dfrac{1}{2}}}{2 \times 0.4} \\ \\ \\ 0.1 \times T^{-\dfrac{1}{2}}= 2.0 \times T^{-\dfrac{3}{2}} \\ \\ \\T = \dfrac{2}{0.1} \\ \\ \\ T = 20[/tex]

As a result, the time period in which achieving a negative cash condition is = 20 months.


Related Questions

On the midnight shift, the number of patients with head trauma in an emergency room has the probability distribution shown below. x 0 1 2 3 4 5 Total P(x) .02 .31 .25 .19 .13 .10 1.00 (a) Calculate the mean and standard deviation. (Round your mean value to 2 decimal places and standard deviation to 3 decimal places.) Mean Standard deviation (b) Describe the shape of this distribution. multiple choice Skewed to the right Skewed to the left Symmetric

Answers

Answer:

Mean = 2.40

Standard deviation = 1.356

Step-by-step explanation:

Given the data:

X :___ 0 __1 ___ 2 ___ 3 __ 4 __ 5 __Total

P(x)_0.02_0.31_0.25_0.19_0.13 _0.10_ 1.00

The mean [E(X)]

Σx*p(x)

(0*0.02)+(1*0.31)+(2*0.25)+(3*0.19)+(4*0.13)+(5*0.10) = 2.4

The standard deviation :

Std(x) = sqrt[VAR(x)]

Var(x) = ((0^2 * 0.02)+(1^2 * 0.31)+(2^2 * 0.25)+(3^2 * 0.19)+(4^2 * 0.13)+(5^2 * 0.10)) - 2.4^2

Var(X) = 7.6 - 5.76 = 1.84

Std(X) = sqrt(1.84) = 1.356 (3 decimal places)

Add 1/4+9/14+6/7. Simplify the answer and write it as a mixed number.

Answers

Answer:

In words - thirty-nine ninths minus twenty-five ninths = fourteen ninths.

An introductory psychology class has 9 freshman males, 15 freshman females, 8 sophomore males, and 12 sophomore females. A random sample of n = 2 students is selected from the class. If the first student in the sample is a male, what is the probability that the second student will also be a male?

Answers

Answer

16/43

Step-by-step explanation:

17 Male + 27 female = 44 students

now n= 2 so first student was male so one male student was taken out of the equation so 16 male left. now left male students by remaining students  so now total left students = 43

so, prob = remaining males/remaining students=16/43

Help Plis ...............

Answers

Answer:

it is positive 3/4

Step-by-step explanation:

it is the opposite of -3/4

Answer:

it would be a positive 3/4

Please solve this system of equations.
5x-2y=9
12x-8y=4

Answers

Answer:

(4,11/2)

Step-by-step explanation:

5x-2y=9

12x-8y=4

A quick look will tell us that neither the x- nor the y- coefficient is the same in both equations, so combining the two by addition or subtraction. We can see that 2 is a multiple of 8, since 2 x 4 = 8. We should multiply the first equation by 4.

4(5x-2y=9)

Now we need to decide if we should add or subtract the equations.

20x-8y=36

12x-8y=4

Since we need to have a -8 and a +8 to eliminate the variables, we should subtract them. Change all the signs of the second equation and combine.

20x-8y=36

-12x-8y=4

----------------

8x=32

Divide both sides by 8 to get the x-value:

[tex]\frac{8x}{8} = \frac{32}{8}[/tex]

x=4

Now that we have our x-value, we need to plug in the y-value.

5x-2y=9

5(4)-2y=9

20-2y=9

-2y=-11

y=11/2

So our solution is (4,11/2)

Let's check our work.

5x-2y=9

5(4)-2(11/2)=9

20-22/2=9

20-11=9

9=9

12x-8y=4

12(4)-8(11/2)=4

48-88/2=4

48-44=4

4=4

Our solution is correct.

Answer:

x=4,y=11/2

Step-by-step explanation:

5x−2y=9

12x−8y=4

​In order to solve by elimination, coefficients of one of the variables must be the same in both equations so that the variable will cancel out when one equation is subtracted from the other.

5x−2y=9,12x−8y=4

To make 5x and 12x equal, multiply all terms on each side of the first equation by 12 and all terms on each side of the second by 5.

12×5x+12(−2)y=12×9,5×12x+5(−8)y=5×4

Simplify.

60x−24y=108,60x−40y=20

Subtract 60x−40y=20 from 60x−24y=108 by subtracting like terms on each side of the equal sign.

60x−60x−24y+40y=108−20

Add 60x to −60x. Terms 60x and −60x cancel out, leaving an equation with only one variable that can be solved.

−24y+40y=108−20

Add −24y to 40y.

16y=108−20

Add 108 to −20.

16y=88

Divide both sides by 16.

y=11/2

Substitute 11/2 for y in 12x−8y=4. Because the resulting equation contains only one variable, you can solve for x directly.

12x−8x11/2=4

Multiply −8 times 11/2.

12x−44=4

Add 44 to both sides of the equation.

12x=48

Divide both sides by 12.

x=4

The system is now solved.

x=4,y=11/2

What type of triangle is this if lengths of its sides are 37m, 24m, and 5m *​

Answers

Answer:

weird triangle

Step-by-step explanation:

Answer:

Scalene triangle

Step-by-step explanation:

Scalene triangle: If the length of all the sides of triangle have  different measurements then it is scalene triangle

Cassandra works for a company that is based off her sales. If she is paid 9.5% of her total monthly sales, calculate her pay for the month if she sells $15,670 of product.

Answers

Answer:

I don't understand what you mean. but 10.43 i guess

Which of the following scenarios represents a possible impulse purchase?


Bryce researches interest rates on the purchase of a new car before deciding to make a purchase.

Bryce budgets for his first new car and decides to purchase a car through a dealership offering 0% interest to first-time buyers.

Bryce purchases the car of his dream by financing the entire cost of the car with a high interest bank loan.

Answers

Answer: Bryce purchases the car of his dream by financing the entire cost of the car with a high interest bank loan.

Step-by-step explanation: Please mark brainliest I am trying to level up

easton is paid $418.96 weekly. what is his average monthly net, or take-home pay?

Answers

Answer:

293.27

Step-by-step explanation:

418.96 x  .7 = 293.27

I am not good at math, will give brainliest

Answers

Answer:

the answer is a

Step-by-step explanation:

"Jonas prepared himself to walk to the stage when the applause ended and the Chief Elder picked up the next folder and looked down to the group to call forward the next new Twelve. He was calm now that his turn had come. He took a deep breath and smoothed his hair with his hand." - The Giver *

1st person
2nd person
3rd person objective
3rd person limited
3rd person omniscient

Answers

Answer:

3rd limited

Step-by-step explanation:


A university wants to investigate how much its students spend on textbooks each semester. Since all
students must purchase their materials through the campus bookstore, a random sample of 15 student
accounts is selected, and the averagą dollar amount spent on textbooks is calculated.
Which of these circumstances would make it inappropriate to use this sample to calculate a 95%
confidence interval for the mean amount spent on books by students at this university?
The standard deviation of the textbook costs is below $30.
The standard deviation of the textbook costs is larger than $100.
A stem-and-leaf plot of the textbook costs shows a roughly symmetric distribution
A histogram of the textbook costs is calculated and shows a slight skew to the right.
A boxplot of the textbook costs shows two students whose amounts would qualify as outliers,

Answers

Answer:

Step-by-step explanation:


What is the value of x in trapezoid ABCD?

Answers

Answer:

15

Step-by-step explanation:

Please help me if you can!

Answers

Mrs. Duran had $665 at the end of the day

I need help on my trig can someone help me on the question please and thank you

Answers

Answer:

210 degrees

Step-by-step explanation:

Convert the problem from radians to degrees using the ratio 180/ and it will give you 210.

Write a jingle to advertise
favorite dessert to the tune of
"Twinkle, Twinkle Little Star."
What is so special about this
dessert? How can you describe it
in a memorable, catchy way?

Y’all someone help no link ,will be reported

Answers

My Jingle:

Ice cream cake - oh, ice cream cake...

How I love the way you taste...

You melt in my mouth with every bite...

Dreams of you keep me up at night...

Ice cream cake - oh, ice cream cake...

How I love the way you taste.

I hope you like it!

The calibration of a scale is to be checked by weighing a 13 kg test specimen 25 times. Suppose that the results of different weighings are independent of one another and that the weight on each trial is normally distributed with Sigma = 0.200 kg. Let µ denote the true average weight reading on the scale.

Required:
a. What hypotheses should be tested?
b. With the sample mean itself as the test statistic, what is the P-value?

Answers

Solution :

a).

Given : Number of times, n = 25

            Sigma, σ = 0.200 kg

            Weight, μ = 13 kg

Therefore the hypothesis should be tested are :

[tex]$H_0 : \mu = 13 $[/tex]

[tex]$H_a : \mu \neq 13$[/tex]

b). When the value of [tex]$\overline x = 12.84$[/tex]

 Test statics :

   [tex]$Z=\frac{(\overline x - \mu)}{\frac{\sigma}{\sqrt n}} $[/tex]

  [tex]$Z=\frac{(14.82-13)}{\frac{0.2}{\sqrt {25}}} $[/tex]

          [tex]$=\frac{1.82}{0.04}$[/tex]

          = 45.5  

P-value = 2 x P(Z > 45.5)

            = 2 x 1 -P (Z < 45.5) = 0

Reject the null hypothesis if P value  < α = 0.01 level of significance.

So reject the null hypothesis.

Therefore, we conclude that the true mean measured weight differs from 13 kg.

convert 2x + y = -1 to slope intercept form

Answers

Answer:

y=-2x-1

Step-by-step explanation:

Your goal from Standard form to slope intercept form is to have the x on the right side of the equal sign. All you have to do is subtract 2x from both sides and you end up with y= -2x-1

Huh?! Its me DaBaby less gooo i need your help with this question. Yeah Yeah!

Answers

Answer:

[tex]4\sqrt{3}[/tex]

Step-by-step explanation:

[tex]\sqrt{48} \\\\4\sqrt{3}[/tex]

Answer:

the second option is correct

Step-by-step explanation:


Please help ASAP please help

Answers

Answer:

64

Step-by-step explanation:

8x4 is 32 multiplied by 2 is 64

V=LxWxH

(length x Width x Height)

Zachary's rectangle measures 4 1 /4 units by 4 1 /4 units. What is its area?

Answers

Answer:

169/12 square units.

Step-by-step explanation:

Mary is having her living room and bedroom painted. Interior Designs USA charges $60.00 to evaluate the space plus $35.00 per hour of labor. Splash of Color charges $55.00 per hour with no initial fee. Which of the following are true? Select all that apply.

A) If it takes 7 hours to paint the two rooms, Interior Designs USA will charge the least.
B) Splash of Color will always charge the least.
C) If it takes more than 5 hours to paint the rooms, Splash of Color will be more cost effective.
D) If it takes 10 hours to paint the rooms, Splash of Color will charge $200 more than Interior Designs USA.
E) If it takes 3 hours to paint the rooms, both companies will charge the same amount.

Answers

Answer:

A and E

Step-by-step explanation:

A) 7 hrs in IDU will cost you $305.00 while SC cost $385

B) 4hrs in and SC will charge you more than IDU by $20

C) SC charges you more than IDU by $50 so IDU is more cost effective

D)SC will charge you $140 more than IDU but not $200

E) 55 x 3 = 165 while 35 × 3 105 plus 60 is 165 therefore it is the same

(-6, -7) and (3,-4)
Pleaseee helppppppp​

Answers

Answer:

y = x/3 - 5

Step-by-step explanation:

Answer:

y = (1/3)x  - 5 .

Step-by-step explanation:

(-6 , -7) ; (3 ,-4)

Slope = [tex]\frac{y_{2}-y_{1}}{x_{2}-x_{1}}\\[/tex]

          [tex]=\frac{-4-[-7]}{3-[-6]}\\\\= \frac{-4 + 7}{3+6}\\\\= \frac{3}{9}\\\\=\frac{1}{3}[/tex]

m = 1/3   ; (3,-4)

y - y1 = m(x - x1)

[tex]y - [-4]=\frac{1}{3}(x-3)\\\\y + 4 = \frac{1}{3}x-3*\frac{1}{3}\\\\y + 4 = \frac{1}{3}x-1\\\\y =\frac{1}{3}x-1-4\\\\y = \frac{1}{3}x - 5[/tex]

(12x - 3)* 105*. What is the value
of x in the figure
at the right?

Answers

If you look in the back off your book if that’s a odd question you can see the answers

8. How tall is a stack of 26 coins each 0.03 m thick? ​

Answers

Answer:

0.78

Step-by-step explanation:

0.03*26=0.78 simple math lol

Find the area of the regular octagon with radius of 14
feet.


Answers

Answer:

uhm- ok ok ok level hard o my gosh

write 98 as a product of its prime factor no links or photo or I will report you​

Answers

the prime factors of 98 are written as 2 x 7 x 7 or 2 x 72,

A warren of rabbits has a population of 350. The population is increasing at a rate of 3% per year. How can you write an exponential growth function to find the monthly growth rate? (I have other question pls help if you can)

Answers

The exponential growth function to find the monthly growth rate is:

[tex]P(t) = 350~ (1 + 0.02493)^t[/tex]

We have,

To write an exponential growth function to find the monthly growth rate, use the following formula:

[tex]P(t) = P_0 (1 + r)^t[/tex]

Where:

P(t) is the population at time t

P₀ is the initial population (350 in this case)

r is the growth rate per time period (monthly rate in this case)

t is the time in the corresponding time period

To find the monthly growth rate.

[tex]= (1 + r)^{1/12} - 1[/tex]

= [tex](1 + 0.03)^{1/12} - 1[/tex]

= 0.02493

= 2.493 %

Therefore,

The exponential growth function to find the monthly growth rate is:

[tex]P(t) = 350~ (1 + 0.02493)^t[/tex]

Learn more about exponential growth functions here:

https://brainly.com/question/14355665

#SPJ4

3/2 inches of snow fell in 3/4 of an hour. Which two statements are correct?

Answers

Answer:

A and E

Step-by-step explanation:

S - 4= -8
What is S?

Answers

Answer:

S = -4

Step-by-step explanation:

-8 minus -4 is basically -8-(-4) which converts to -8+4, and the result of that is -4.

Answer:

s-4+4=-8+4

s=-4

Step-by-step explanation:

x is equal to -4

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