Question

I need help with this question as soon as possible. I can’t understand any part. It would be great if you show your work and explain all four part!

2. Product Rule On the Black Wednesday, the price of Bitcoin was rapidly decreasing about 25%! We estimate how much money flowing out from the market on that day. In other words, we want to evaluate the rate of the total exchange in the market. (a) The total exchange in the market is counted by dollars (S) and the exchange volume is the total amount of coin exchanged in the market. Then what is the unit of the price of Bitcoin and the exchange volume? (b) Let V(t) be the exchange volume and P(t) be the price of Bitcoin at time t. Find the total exchange in the market in terins of V(t) and Plt). (c) On the 'Black Wednesday', the exchange volume was 950, 000 coins and the ex- change volume was increasing at X coins per day. The average price of bitcoin was $17,000 per coin, and this average was decreasing at about $4,500 per day. Use the Product Rule and these figures to estimate the rate of total exchange on the 'Black Wednesday' as a function of X. Assume that there was no big difference of the exchange volume betwen Tuesday and Black Wednessday - the rate of exchange volume is zero. Then evaluate the rate of total exchange in the market and explain its meaning (d) Page 2

Answer 1

The aim of the problem is to make student aware on turnover/money volume in an excahge.

total exchange= number of bitcoins X average price per bit coin

rate of total exchange = rate of (number of bitcoins(volume) X average price per bit coin)

= rate of number of bitcoins(rate of volume) X average rate per bitcoin + number of bitcoins (volume) X rate of average price of bitcoin

a. Unit of price of bit coin is Dollars per bitcoin and unit for exchange volume is number of coins that were traded in exchange.

b. Total exchange is V(t) multiplied by P(t) and its units are dollars

c. Rate of exchange is change in total exchange per day, which is

-4500*950000+17000*X

d. rate of total exchange is not simply rate of exchange volume multiplied by rate of price change. so rate of volume may be zero but rate of total exchange can be non zero if there is rate of price. from C we get the rate of total excahnge if rate of volume is zero and rate of price is -4500 is -4500*950000= -4275000000 per day

feel free to comment for any clarifications