Homework 3

Due 2020-09-23 at Midnight.

  1. Study Chapters 9-11, & 13 of Shotts.

  2. • Do one of the following two assignments in python and the other in R.
  3. Read the Pricing Asian Options file and answer all the questions in the document. Put all the answers in a file labeled option.py or option.R and include all the graphs as directed. Be sure to use best practices in coding and always assess Monte Carlo error with the estimates.
  4. Write a program entitled zombiedice.py or zombiedice.py that plays one round of the game Zombie Dice. The rules can be found here. In the program, establish a concrete stopping rule where at some point you decide to stop trying to roll for more points. Try to establish a stopping rule that gives a number of expected brains greater than 2.15. Run a minimum of 50,000 simulations in your program to beat it. Make sure your code is reproducible so that the results you get will be repeated when we run the code. Recall that there are 6 green die that have 3 brains, 2 footprints, and 1 shotgun, 4 yellow die have 2 brains, 2 footprints, and 2 shotguns, and 3 red die have 1 brain, 2 footprints, and 3 shotguns. The rest of the details are in the rulebook.
  5. Submit this homework by committing the necessary files in the appropriate directory and pushing to your central Git repository. Remember to not commit files that are easily reproducible.