Class 12: Probability and Statistics for Financial Modeling Flashcards
1
Q
what is a discrete random variable?
A
2
Q
what are the properties of expectation?
A
3
Q
what are the two types of skewness?
A
- positive skewness
- negative skewness
4
Q
what are the two ways to interpret skewness?
A
- direction of outliers
- distribution of mean, median and mode
5
Q
what does direction of outliers tell us?
A
6
Q
what does the distribution of mean, median mode tell us?
A
7
Q
what do the values of skew tell us?
A
8
Q
what is Kurtosis?
A
9
Q
what does Mesokurtic mean?
A
10
Q
what does Leptokurtic mean?
A
11
Q
what does platykurtic mean?
A
12
Q
what is the lognormal distribution?
A
13
Q
mean and variance of lognormal distribution
A
14
Q
what is the Central Limit Theorem (CLT)?
A
15
Q
what are the four assumptions of CLT?
A
16
Q
what does Black Scholes Merton Model assume?
A
