Question

The increase or decrease in the price of a stock between the beginning and the end of a trading day is assumed to be an equally likely random event. What is the probability that a stock will show a decrease in its closing price on six consecutive​ days? The probability that a stock will show a decrease in its closing price on six consecutive days is nothing. ​(Round to four decimal places as​ needed.)

Answer 1

solution:-
The increase or decrease in the price of a stock between the beginning and the end of a trading day is assumed to be an equally likely random event.
P(increase) = P(decrease) = 1/2
then that
=> (1/2)^6

=> 1 / 64

=> 0.0156