Use the method of Exercise 4 to find the variance of a lognormal variable in terms of
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Use the method of Exercise 4 to find the variance of a lognormal variable in terms of the parameters of the underlying normal variable
Data from Exercises 4
Suppose that \(u=e^{w}\), where \(w\) is normal with expected value \(\bar{w}\) and variance \(\sigma^{2}\). Then
Show that
Use the fact that
to evaluate \(\bar{u}\).
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