Question: We assume that the stochastic process for a stock price is a Geometric Brownian motion, with expected return of 16% and, volatility of 12%. The

We assume that the stochastic process for a stock price is a Geometric Brownian motion, with expected return of 16% and, volatility of 12%. The stock price is currently $84. (a) Find the expected value of the stock price in 3 years. (b) Find the probability that the stock price will be above $111 in 3 years. A) 134.75 (B) 135.75 (C) 137.75 (D) 138.75 (E) 136.75 Select V 1 Part (a) choices. A) 0.84 (B) 0.80 (C) 0.81 (D) 0.83 (E) 0.82 . Select V Part (b) choices. We assume that the stochastic process for a stock price is a Geometric Brownian motion, with expected return of 16% and, volatility of 12%. The stock price is currently $84. (a) Find the expected value of the stock price in 3 years. (b) Find the probability that the stock price will be above $111 in 3 years. A) 134.75 (B) 135.75 (C) 137.75 (D) 138.75 (E) 136.75 Select V 1 Part (a) choices. A) 0.84 (B) 0.80 (C) 0.81 (D) 0.83 (E) 0.82 . Select V Part (b) choices
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