Posted by **abdul** on Thursday, March 15, 2012 at 12:33am.

Consider the N-period binomial model and processes Y0,Y1,...YN and C0,C1,...CN. Suppose that Y is Markov and C is deterministic (i.e., Cn does not depend on the coin flips ù).

a) Show: If Cn doesn't equal 0 for all n, then C0Y0,C1Y1,....,CNYN is Markov.

b) Give an example of processes C and Y such that at least one Cn is zero and C0Y0,C1Y1,....,CNYN is not Markov.

## Answer this Question

## Related Questions

statistics - S) Suppose we want to determine the (binomial) probability (p) of ...

probability - Rosencrantz and Guildenstern In the opening scene of Tom Stoppard...

Probability - Rosencrantz and Guildenstern In the opening scene of Tom Stoppard...

Statistics - Suppose we want to determine the (binomial) probability (p) of ...

Math - A weighted coin has the property that the Heads comes up 60 percent of ...

math - weighted coin has property that heads comes up 60 percent of time. two ...

statistics - you and 50 coworkers decide to play a game that consists of ...

maths - Suppose there are 10 coins laid out in front of you. All of the coins ...

math..probabilities - A weighted coin has the property that the Heads comes up ...

math - francisco tossed the coin 10 more times. he got 5 heads and 5 tails. now ...