Create a Monte Carlo simulation that generates 2,500 outcomes of S. Compute the average and standard deviation of the resulting list to confirm the results of 6 and 7. Start your code by setting the...

Create a Monte Carlo simulation that generates 2,500 outcomes of S. Compute the average and standard deviation of the resulting list to confirm the results of 6 and 7. Start your code by setting the seed to 1 with set.seed(1).

Create a random variable S with the earnings of your bank if you give out 10,000 loans, the default rate is 0.3, and you lose $200,000 in each foreclosure. Hint: use the code we showed in the previous section, but change the parameters.