Suppose that the daily log returns on a stock are independent and normally distributed with mean 0.001 and standard deviation 0.015. Suppose you buy $1,000 worth of this stock. (a) What is the...

Suppose that the daily log returns on a stock are independent and normally distributed with mean 0.001 and standard deviation 0.015. Suppose you buy $1,000 worth of this stock.

(a) What is the probability that after one trading day your investment is worth less than $990? (Note: The R function pnorm() will compute a normal CDF, so, for example, pnorm(0.3, mean = 0.1, sd = 0.2) is the normal CDF with mean 0.1 and standard deviation 0.2 evaluated at 0.3.)

 (b) What is the probability that after five trading days your investment is worth less than $990?