Interview Question: Price Movement

Sample Question #286 (finance)
 
Do you think stock prices follow a normal distribution or lognormal distribution? State justifications for both and tell me why you pick one over the other.
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One Response to Interview Question: Price Movement

  1. Brett says:

    ANSWER
     
    A really good open-ended case question. We usually use lognormal because prices cannot be negative, among other reasons.

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