Problem 12-05 (Algorithmic) The price of a share of a particular stock listed on

Question

Problem 12-05 (Algorithmic)

The price of a share of a particular stock listed on the New York Stock Exchange is currently $43. The following probability distribution shows how the price per share is expected to change over a three-month period:

Set up intervals of random numbers that can be used to generate the change in stock price over a three-month period. If required, round your answers to two decimal places.

With the current price of $43 per share and the random numbers 0.8391, 0.8873, 0.4053 and 0.3907, simulate the price per share for the next four 3-month periods.

What is the ending simulated price per share?

$  

Stock Price Change ($) Probability -2 0.30 -1 0.15 0 0.10 1 0.05 2 0.05 3 0.05 4 0.30

Explanation / Answer

Initial price - $43

ending simulated price per share = $ 49

Please rate my solution

Stock Price Change Probability Interval -2 0.30 0 but less than 0.30 -1 0.15 0.30 but less than 0.45 0 0.10 0.45 but less than 0.55 +1 0.05 0.55 but less than 0.60 +2 0.05 0.60 but less than 0.65 +3 0.05 0.65 but less than 0.70 +4 0.30 0.70 but less than 1

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