• We are pleased to announce that the winner of our Feedback Prize Draw for the Winter 2024-25 session and winning £150 of gift vouchers is Zhao Liang Tay. Congratulations to Zhao Liang. If you fancy winning £150 worth of gift vouchers (from a major UK store) for the Summer 2025 exam sitting for just a few minutes of your time throughout the session, please see our website at https://www.acted.co.uk/further-info.html?pat=feedback#feedback-prize for more information on how you can make sure your name is included in the draw at the end of the session.
  • Please be advised that the SP1, SP5 and SP7 X1 deadline is the 14th July and not the 17th June as first stated. Please accept out apologies for any confusion caused.

Ch1 Q Pg18

A

Actuary@22

Very Active Member
Hi

In the ques on pg 18 of Ch 1 as per 2019 acted material ,how is the process Markov? Since Xt depends on the past value i:e X t-1 and also the probabilties are dependent on X t-1 so the process doesnt appear Markov to me.
Pls explain
 
Hi

For a process to be Markov, we need only know the current value of the process to predict its future states. Therefore even though the current value of the process depends on the past values, the path that the process took to reach the current value does not affect the probabilities of future states.

In the example give, let's say Xt = 1, then Xt+1 can be either 0 or 2, and we only need to know that Xt = 1 to calculate the probabilities for Xt+1.

Dave
 
You must log in or register to reply here.
Back
Top