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Microsoft Excel Data Analysis and Business Modeling (Office 2021 and Microsoft 365), 7th Edition
book

Microsoft Excel Data Analysis and Business Modeling (Office 2021 and Microsoft 365), 7th Edition

by Wayne Winston
December 2021
Beginner to intermediate
1168 pages
30h 17m
English
Microsoft Press
Content preview from Microsoft Excel Data Analysis and Business Modeling (Office 2021 and Microsoft 365), 7th Edition

Chapter 64

Using the lognormal random variable to model stock prices

Questions answered in this chapter:

  • What is a lognormal random variable?

  • Is there a reason stock prices might follow a lognormal random variable?

  • How can I model the future price of any stock as a lognormal random variable?

  • How can I compute the probability that Microsoft’s stock price will exceed $130 six months from now?

  • How can I compute the probability that in six months, Microsoft stock will sell for $90 or less?

  • How can I compute the median price of Microsoft stock in six months?

Many people are interested in modeling the future price of a stock, a commodity such as oil or wheat, or a future exchange rate. For the last 40 years, the lognormal random variable has been ...

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Publisher Resources

ISBN: 9780137613816