Markov Chains, Markov Process, Python, Discrete Time Markov, Probability.
Corp’s stock price movement at each time step t using the probability distribution π_t at time t. The simulation procedure goes like this: Assume Acme’s IPO price to be $100. Set the initial probability distribution: π_0=[P(X_t = +1)=0.5, P(X_t = -1) = 0.5]. Map the +1 Markov state to the action of