The tool of Series solutions in Quantitative Finance
Explain the tool of Series solutions in Quantitative Finance.
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Series solutions: If your equation is linear and they mostly all are in quantitative finance then you might be capable to solve a particular problem with adding together the solutions of many problems. Series solutions are while you decompose the solution in a (potentially infinite) sum of simple functions, as cosines and sines, or a power series. It is the case, for illustration, with barrier options consisting of two barriers, one below the current asset price and another above.
Your firm have just issued five year floating-rate notes indexed to six-month U.S. dollar LIBOR plus 1/4%. Describe the amount of first coupon payment your firm will pay per U.S. $1,000 of face value, if six-month LIBOR is at present 7.2%?Solution:
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Explain number of dimensions in Monte Carlo method.
Where is Crash Metrics Used?
Elaborate the statement: Coefficient of variation is a better risk calculator to use than the standard deviation when estimating the risk of capital budgeting projects.
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Explain the deterministic volatility in an option-pricing.
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How can financial managers estimate the average tax rate?
What are the ways to build-up the volatility effect in an option-pricing?
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