Financial Engineering Aptitude Test FEAT 10
Team Latte
Dec 26, 2005
Problem 1
If 9 + 9 = 100 and 77 + 2 = 234 then what is the value of 12 + 11 + 313 = ?
(a) 551
(b) 48984
(c) 895
(d) 119528
Problem 2
Your friend holds a coin in his one of his palms and asks you what the probability is of the coin being in the right palm. You answer 50%. Your friend disagrees and says it is 100%.
Please comment on the above. Problem 3
A contract with a notional value of $100 pays to the holder of the contract:

or

Where the variable is the indexed value of real estate price in Mumbai , India and is a predetermined value (constant) of the variable.
(a) What will be the change in the value of the contract with respect to
after a period of time if the value of is less than that of by a factor of 3 ?
(b) The contract is both convex and concave. Explain.
Problem 4
The following differential equation:
(a) will have two values;
(b) a single value;
(c) will have three values;
(d) None of the above;
Problem 5
In not more than 100 words, describe what is the role of a financial engineer and how it is different from that of a mechanical engineer? ______________________
  
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