A Random Walk Process Consists of the Toss of a Fair

question 1

Multiple Choice

A random walk process consists of the toss of a fair coin at the end of each day. If the outcome is heads stock price increases by 1.25% and if the outcome is tails the stock price decreases by 0.75%. What is the drift of such a process?

• A) +1.25%
• B) -0.75%
• C) +0.25%
• D) None of the above

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Definitions:

Neurotransmitters

Chemical messengers that transmit signals across a chemical synapse from one neuron (nerve cell) to another 'target' neuron, muscle cell, or gland cell.

Neuron

The fundamental unit of the nervous system, responsible for receiving, processing, and transmitting information through electrical and chemical signals.

Biochemicals

Molecules that form the chemical basis of biology, including substances like hormones, neurotransmitters, and enzymes, crucial for living organisms.

Continuum Model

A theoretical model that suggests certain phenomena, such as mental health issues, exist on a continuous spectrum rather than being distinct categories.