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Business Case 4

BUSA 421 Data Mining

Fall 2020

Instructor: Prof. Brodnax

INCOME _ DISTRICT _ CONDITION

B&R Oil & Gas Ltd. stock is listed on the NASDAQ stock exchange currently at $33 per share. The

following probability distribution shows how the price per share is expected to change over a three-

month period.

a). Construct a simulation model that computes the value of the stock price in 3 months, 6 months,

9 months, and 12 months under the assumption that the change in stock price over any 3-month

period is independent of the change in stock price over any other 3-month period. Describe in detail

what the result from the data run indicates.

b). With the current price of $33 per share, simulate the price per share for the next four 3-month

periods. What is the average stock price per share in 12 months? Again, describe in detail what the

result from the data run indicates.

Provide a thorough analysis for your answers to both a. and b. in the analysis word document. Be

sure and use the correct notations that explains all equations and variables as appropriate. You

should paste in appropriate charts/graphs into the word document that explains your answer.

Remember, excel is a tool that helps take the data and transform it into information which then

allows you to make an informed decision. The analysis is not in the tool, but in the interpretation of

the results from the tool. The stock price prediction app excel template is posted with this business

case. Note, there will be changes in the prices after updates due to the random number generator

used in the app template. You may need to make adjustments to this template based on the

analyst’s guide. The analyst’s guide is also posted with this business case.

Please save your answers into the Analysis Word document. Also, post the excel worksheet as part

of the objective evidence (OE) as to how you derived your responses. Please post both documents in

the "Business Case 4 Dropbox" NLT 11:59 PM on 4 Dec.