# Long Dong Chinese Man Homework Essay Sample

This assignment is about applying statistics in finance. Before starting this assignment, it is important to review the Note on Review of Statistics. It is also recommended to use statistical functions in Excel or Spreadsheets for calculations. In accordance with the Coursera Honor Code, I, Amanda Milligan, verify that the answers given are solely my own work.

Exxon Oil Company shareholders are exposed to various risks associated with holding its shares, particularly in relation to the demand for Exxon’s fuels from the airline industry. If the economy weakens, there is typically a decrease in travel, resulting in lower demand for Exxon’s fuels. Such risks are categorized as Specific/Idiosyncratic Risk for Exxon’s shareholders.

There are three securities (X, Y, and Z) available for selection. The next year’s economy will experience an expansion, normal, or recession state with probabilities of 0.30, 0.35, and 0.35 respectively. The returns (%) on these securities in each state are as follows: Security X {expansion = +10, normal = +8, recession = +6}; Security Y {+25,+10,-10}; Security Z {+7.5,+7.5,+7.5}. Assuming the investor is risk neutral, they must choose between investing in Security Y or Security Z. In this case, the investor is indifferent between Y and Z.

Your grandfather is seeking your investment advice because he values your expertise in finance and statistics. He is concerned about the recent financial turmoil and wants a low-risk portfolio recommendation. There are three portfolio options (A, B, and C) to consider for the upcoming year, which is expected to have an expansionary, normal, or recessionary state with probabilities of 0.40, 0.40, and 0.20 respectively. The corresponding returns (%) for these portfolios in each state are as follows:

• Portfolio A: Expansion = +13, Normal = +9, Recession = +8.5
• Portfolio B: Expansion = +10, Normal = +9, Recession = +5
• Portfolio C: Expansion = +13, Normal = +8, Recession = +7.5

You must determine which investment option best aligns with your grandfather’s needs.

Investors typically demand a risk premium when holding a security, regardless of the source of the additional risk.

The covariance between the returns of a stock and its own return is always one, but calculating covariances among the returns of multiple stocks can be complex.

As a CEO, you are considering providing smartphones to your employees in order to improve their availability for clients and sales. However, you have concerns about potential work distractions such as gaming and social media updates. To investigate this issue, you conducted an experiment where 6 employees were randomly selected. Three of them received smartphones while the other three continued using their existing technology. The table below shows the changes in sales for each employee. Your goal is to determine the correlation between having a smartphone and an increase in sales. You can use the correl spreadsheet function to calculate this correlation. Please provide the correlation percentage without including the % sign.

Employee Smartphone Sales Change
Anthony Yes 60
Kira No<//<>/</>

/>

<r/Michael/t/>No/

<d/Scarlett/t/>Yes/<-20/-20/
<>Yes

-5/-5/

<>No

-35/-35/

Investors typically avoid taking on risk, resulting in a higher price for government bonds compared to corporate bonds that are otherwise similar.

Your client has three securities to choose from: X, Y, or Z. The world can fall into one of three categories: expansion, normal, or recession. Each category has probabilities of 0.40, 0.40, and 0.20 respectively.

During the expansion state:

– Security X offers returns of +14%

– Security Y offers returns of +11%

– Security Z offers returns of +13%

In the normal state:

– Security X provides returns of +10%

– Security Y provides returns of +9%

– Security Z provides returns of +8%

In the recession state:

– Security X has returns of +7%

– Security Y has returns of +8%

– Security Z has returns of +7.5%

Based on this information, which security should you discourage your client from investing in?

You have recently become the fund manager at a brokerage firm. Thomas, your assistant, is giving you an update on the current portfolio. He suggests transferring some funds from Alpha to Gamma for better diversification. Here is the data on all three stocks:

Beta\$27.50 20%\$27.50\$26\$25

Stock Current Price Current Weight Next Year’s Price (Expansion) Next Year’s Price (Normal) Next Year’s Price (Recession)
Alpha 40 80% 48 44 36

Based on this information, Thomas believes that reallocating some of our funds from Alpha to Gamma will help improve diversification. Do you agree?

Suppose there are two mortgage bankers. Banker 1 has two \$1,000,000 mortgages to sell. The borrowers live on opposite sides of the country and face an independent probability of default of 5%, with the banker able to salvage 40% of the mortgage value in case of default. Banker 2 also has two \$1,000,000 mortgages to sell, but Banker 2’s borrowers live on the same street, have the same job security and income. Put differently, the fates and thus solvency of Banker 2’s borrowers move in lock step. They have a probability of defaulting of 5%, with the banker able to salvage 40% of the mortgage value in case of default. Both Bankers plan to sell their respective mortgages as a bundle in a mortgage-backed security (MBS) (i.e., as a portfolio).

## Analysis Of Hemingway Vs. Faulkner Writing Styles

Various writers have developed their own distinct writing styles which reveal their personalities and aid readers in grasping the tone of their works. In the early 20th century, a fresh America gave rise to numerous skilled writers with varied styles. Some authors, such as Ernest Hemingway and William Faulkner, chose to adopt a realistic approach in their writing. While Faulkner had a deep understanding of the post-Civil War era, Hemingway focused on the early 1920s in his short stories. Despite these differences, both authors shared a thematic emphasis.

Although Hemingway and Faulkner were both realist writers who depicted their concern about the transformations occurring in America, their writing styles vary significantly. When analyzing the styles of Hemingway and Faulkner, readers will observe disparities in sentence structure, word selection, and character portrayal. Nevertheless, despite these distinctions, both authors effectively convey a comparable tone in their works. In numerous short stories by Faulkner like “Barn Burning,” intricate sentence structures are employed to provide elaborate depictions of characters and settings that some might consider unimportant.

Faulkner utilizes lengthy and intricate sentences adorned with hyphens and colons to seamlessly develop his ideas. In his work “Barn Burning,” Faulkner crafts a sentence that illustrates this technique, stating, “Now he could hear his father’s stiff foot as it came down on the boards with clockwise finality, a sound out of all proportion to the displacement of the body it bored and which was no dwarfed either by the white door before it as though it had attained to a sort of vicious and ravening minimum not to be dwarfed by anything…” Throughout his writing, Faulkner consistently employs meticulous descriptions, even when portraying the mere sound of the father’s imperfect footsteps.

Both Hemingway and Faulkner use sentence structure to create a specific tone in their writing. While Faulkner employs long and detailed sentences to enhance the effect of his stories, Hemingway opts for short and blunt statements to establish the desired tone. Despite their different approaches, both authors ultimately achieve a similar sad tone in many of their stories. The sentence structure employed by these two writers is instrumental in conveying their intended tone.

The tone of an author’s story can be shaped by their word choice. William Faulkner prefers more complex words compared to Ernest Hemingway. In Faulkner’s stories, the words he selects are often symbolic. For example, in “A Rose for Emily,” Faulkner’s choice of words serves to establish the story’s tone. Furthermore, Faulkner’s use of complex sentences often relies on his word choices. On the other hand, Hemingway’s word choice is simpler and direct. His ideas are expressed plainly through his words, making it easier for readers to understand his stories without further interpretation.

## The Catcher In The Rye And The Outsider Novels

Albert Camus’ The Stranger and J.D. Salinger’s The Catcher in the Rye are both among the most important novels of the twentieth century. The modern world’s general moral change and the individual’s alienation from the society serve as the main, basic topic for both novels which is still relevant to any twenty first century reader. Since many people find themselves in the same position of feeling like an outsider from society in their own worlds, I intend to outline how it still finds relevance today.

Both characters, Meursault and Holden Caulfield share the same sense that they are alienated from the worlds in which they live in which is important to a twenty first century reader as many people have problems assimilating themselves into society. Like Holden, teens today also resist conforming to society’s norms as is also highlighted in The Stranger with the protagonist Meursault. Salinger chooses to narrate his novel so that the novel that depicts his protagonist, Holden’s, transition from adolescence to adulthood. In contrast, Camus writes his novel in order to record the events leading up to, and the last days before, the execution of his main character, Meursault. Through the employment of settings, characterisation and endings, both authors imply that society’s pressure on the individual to fit in plays a major part in both of these climaxes, this has huge importance to any twenty first century reader as the topic is still challenged in today’s society.

Both characters Meursault and Holden Caulfield suggest that society pressures individuals to fit in and conform to. Holden is a teenager struggling with the fact that everyone has to grow up, which to him means that you have to become “phony” or corrupt. Holden distances himself from the adult world and so to stay a child he gets himself expelled from schools. While on the other hand Meursault does things for no real reason. He is completely aloof, unattached and almost an unemotional person. He does not think much about events or their consequences, nor does he express much feeling in relationships or during emotional times. Both of these characters express their detachment from society which is relevant for many people in the twenty first century’s society as many people find difficulty finding their place within civilization.

Holden’s conversational tone and choice of words illustrates his rebellion from adult society as a stereotypical teenager. His frustration with adults is characterized by his persistent use of words like “goddamn,” “puked,” “hell,” “crap,” and “moron.” When Holden describes Jane’s stepfather, he talks about how he would “run around the goddamn house naked”. He continues using this word when he tells the reader how Sally was conversing with a college friend, “they continued their goddamn boring conversation”. This relates to a twenty first century teenager in particular as they also have their own language to separate themselves from their parents such as in the form as instant messaging where abbreviations litter their conversations. Holden also tries desperately to have almost a direct conversation with the reader, aware of his audience; he attempts to impress the audience by exaggeration or repetition through a narrative tone. There is a sense that Holden wants the audience to like him as he utilizes the audience as a counsellor as outpours his ideas.

This is relevant to many teenagers in the twenty first century as they try to find their place in civilization or a school society and may go to extreme lengths to find themselves and create a reputation for people to remember them by. In The Outsider, it is almost the opposite with Meursault. Through short clinical sentences and abrupt punctuation it highlights a detached character. Instead he lists a logical thought process and lays out what he thinks, almost unaware of a reader highlighted in the opening lines, “I’ll catch the two o’clock bus and get there in the afternoon. Then I can keep the vigil and I’ll come back tomorrow night. I asked my boss for two days off…” This almost list style of writing enables the reader from building a connection or impression to the character as there doesn’t seem to be much depth to his emotions or opinions. Meursault is unlike Holden in the sense that he does not crave attention and want people to like him his actions throughout the book explain how he is a stranger to society as he can’t fathom why everyone around him is so interested in his being.

The story examines the uncertainty of justice: the public official compiling the details of the murder case tells him repentance and turning to Christianity will save him, but Meursault refuses to pretend he has found religion; emotional honesty overrides self-preservation, and he accepts the idea of punishment as a consequence of his actions as part of the status quo. The actual death of the Arab as a human being with a family is seems almost irrelevant, as Camus tells us little more about the victim beyond the fact that he is dead. Indeed, Meursault is never even asked to confront, reflect or comment upon the victim as anything other than as a consequence of his actions and the cause of his current predicament. The humanity of the victim and inhumanity of murdering another human being is seemingly beside the point.

The book holds huge relevance to the twentieth century reader as an interesting motif in The Stranger is that of watching or observation. Camus is writing a book about our endless search for meaning: that we are all looking for a purpose in our lives. The characters of The Stranger all watch each other and the world around them. Meursault watches the world go by from his balcony. He later passively watches his own trial; the world around him is a fascination to Meursault. He keenly observes the sun, the heat, the physical geography of his surroundings. The eyes of the jury and witnesses at his trial, finally the idea of the watching crowd, representing the eyes of society, as he is an outsider of the world he surrounds himself in.

To conclude, both The Stranger and The Catcher in the Rye are both relevant to different people within the twenty first century society for many different reasons, but both novels were written with the same topic of how one fits into society. Due to both characters in the novels being from different age groups within society it allows them to become important to people within those same age groups today as many face the same dilemma of finding themselves an outsider within their society.

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