Question: Problem 4.28 (a) Verify by direct calculation that Q(p) = exp( ln(1 p)/) 1 is the p quantile of the Pareto distribution (Equation

Problem 4.28

(a) Verify by direct calculation that Q(p) = exp(− ln(1 − p)/α) − 1 is the p quantile of the Pareto distribution (Equation 4.24), that is show that F(Q(p)) = p.

(b) Using part (a), compute the median of a Pareto distribution with α = 1.5.

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