Analyze the dynamic path - difference equation, Mathematics

One of the well-known class of models that involve a simple difference equation are models of mean reversion. These models typically take the form

yt+1 - yt = -a(yt - μ)where 0 < a< 1

In the equation above μ is the mean of yt.

a) Provide the intuitive explanation for the above equation.

b) Show homogenous, particular and then general solution for the difference equation.

c) Setting t=0 show the solution to the mean-reversion model.

d) Analyze the dynamic path of this model.

Posted Date: 3/23/2013 3:31:25 AM | Location : United States







Related Discussions:- Analyze the dynamic path - difference equation, Assignment Help, Ask Question on Analyze the dynamic path - difference equation, Get Answer, Expert's Help, Analyze the dynamic path - difference equation Discussions

Write discussion on Analyze the dynamic path - difference equation
Your posts are moderated
Related Questions
It is the full blown case where we consider every final possible force which can act on the system. The differential equation in this case, Mu'' + γu'  + ku = F( t) The displ

the wholesale p of string beans in dollars per bushel and the daily supply x in thousands of bushel,are related by the equation px+6x+7p=5950. if the supply is decreasing at the r

Velocity and Acceleration - Three Dimensional Space In this part we need to take a look at the velocity and acceleration of a moving object.    From Calculus I we are famili

Solve the linear equation: The equation relating the pressure that is denoted by P, to the force, F & the area, A, over which the force is applied is P =F/A.  Solve this equat

when is the trnscribing process of data preparation irrelevant ? a)CAPI b) mall panel c) in home interview d) all of them

Consider an election with 721 voters. A) If there are 5 candidates, at least x votes are needed to have a plurality of the votes. Find x. B) Suppose that at least 73 votes are n

just give me some tips to submit a good asignments

what are the formula in the operation of fraction and how will i apply the operation of fraction on word problems

Assume that Y 1 (t) and Y 2 (t) are two solutions to (1) and y 1 (t) and y 2 (t) are a fundamental set of solutions to the associated homogeneous differential equation (2) so, Y

The given figure consists of four small semicircles and two big semicircles.  If the smaller semicircles are equal in radii and the bigger semicircles are also equal in radii, find