PROBLEM SET 4 1) Consider the following utility functions‚ where W is wealth: (a) U (W ) = W 2 1 (b) U (W ) = W (c) U (W ) = −W (d) U (W ) = W (e) U (W ) = ln(W ) (f) U (W ) = W 1−γ ‚ with γ = 2 1−γ How likely are each of these functions to represent actual investor preferences? Why? 2) Suppose investors have preference described by the following utility function with A > 0: U = E(r) − 1 Aσ 2 2 Each investor has to choose between three portfolios with the following characteristics:
Premium Risk aversion Utility Investment
A Book That is out of this world! Close your eyes and take a second to picture what you might think that the future would look? Many people will imagine impossible things that technology still cant gives us. The author of Ender’s Game Orson Scott Card was one of the people who imagined the future‚ but he was the only one to see or predict parts of the future correct. In the book Ender’s Game the authors use of well predicted futuristic technology and the use of drama and action combined it makes
Premium Future
Week 4 Homework Solutions: Problem Set 4 1. Determining Profit or Loss from an Investment. Three years ago‚ you purchased 150 shares of IBM stock for $88 a share. Today‚ you sold your IBM stock for $103 a share. For this problem‚ ignore commissions that would be charged to buy and sell your IBM shares. a. What is the amount of profit you earned on each share of IBM stock? The profit on each share of IBM stock was $15. $103 priced when each share was sold‚ $88 priced when each
Premium Stock Bond Investment
33A “How Julia Child Invented Modern Life” by Karen Lehrman Discussion Questions 1. What were popular American attitudes toward food before Julia Child’s book‚ Mastering the Art of French Cooking? 2. How did American culture change after World War II? 3. How did Julia’s book influence the way Americans viewed food? 4. How did Julia Child influence the way Americans viewed women? 5. Where and how did Julia Child meet her husband? What was he doing at the time? 6. How did Julia Child come
Premium French cuisine
OPIM Assignment 4 1. Cu = 24-11 = $13 Co = 11-7 = $4 Critical ratio = 13/(13+4) = 0.7647 μ = 30‚000 σ = 10‚000 Using normal distribution function (=norminv(0.7647‚30000‚10000))‚ the optimum order quantity is 37‚216 jerseys to maximize profit. 2. Quantity = 32‚000 First‚ we normalize the order quantity to find the z-statistic z=Q-μσ=32‚000-25‚00010‚000=0.7 We then look up the standard normal loss function. The expected lost sale is given by. Lz=0.1429 Therefore‚ the expected lost
Premium Normal distribution
“When They Get Out” by Sasha Abramsky cries out to the general public for the change in corrections that the convicted are unable to do. Abramsky leaves nothing to chance in his war on the prison systems for the awakening of the American society to an ever growing problem. Therefore‚ Abramsky commissions an argument with real uncensored facts. In spite of how incarceration envisions reforming the convicted‚ Abramsky argues that the prison system corrupts prisoners into worse criminal behaviors. Throughout
Premium Prison
In this passage author - Winston Churchill - builds an argument to persuade his audience by using his pure opinion‚ mentioning about historical events. He starts the speech by mentioning about his how does he thinks about he has opportunity of speaking to the people of the United States which makes the contrast between people cannot have opportunity to speak for their country. Main points of his speech is; in simple way‚ Countries like United States and Britain should help Germany since they are
Premium World War II United Kingdom Adolf Hitler
his skin. Jamie came up behind him and asked him a question‚ “Do you think Julia is pretty”. Pompey pondered the question with interest and replied‚ “Why do you think Julia is pretty”. Now Jamie did not know how to reply to his question even though he started the conversation. “Um never mind I’m going to go eat downstairs”‚ said Jamie. After Jamie left Pompey started wondering about Jamie’s question “Julia is pretty but why would Jamie ask that”‚ he thought to himself. Pompey did not think about the
Premium 2005 singles Thought Augustus
who has used those qualities to their best ability was Winston Churchill which is why he is indeed a true hero. Winston Churchill was born on November 18‚ 1874 (Churchill 20) in Blenheim‚ England (winstonchurchill.com). His mom‚ Jenny Jacobson (winstonchurchill.com)‚ died three weeks after Winston was born (Churchill 20) and his dad‚ Lord Randolph Henry Spencer-Churchill‚ died at the age of 45 from syphilis (winstonchurchill.com). Winston went to St. George’s‚ a sleep-away grade school in Blenheim
Premium Leadership Management Hero
Julia Lambert is the main character of Maugham’s novel “Theatre”. She is an independent woman‚ in whom the sense of humor‚ the ability to judge people and to understand the circumstances are combined with being an adventurer.She is a beautiful woman‚ more or less a careful mother‚ a rather good wife and a brilliant actress. In fact Julia is a sensitive idealistic nature and is always searching for perfection in herself and in others. She was really a born actress and it was an understood thing
Premium French people Actor French people in Madagascar