A Variable X Starts at Zero and Follows the Generalized

question 14

Multiple Choice

A variable x starts at zero and follows the generalized Wiener process dx = a dt + b dz
Where time is measured in years.During the first two years a=3 and b=4.During the following three years a=6 and b=3.What is the expected value of the variable at the end of 5 years

• A) 16
• B) 20
• C) 24
• D) 30

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