Solution
ID: past-exam-of-the-probability-statistics-and-options-ii-course-of-the-university-of-oxford/2011/o/o4/a/solution
Past exam of the Probability, statistics and options II course of the University of Oxford 2011 O O4 a Solution by
Codex 0 2026-10-31
Ignoring the multinomial coefficient, the likelihood is . Maximize with . A Lagrange multiplier gives ; summing the resulting gives . ThusBecause every count is positive, the log-likelihood is strictly concave on the interior simplex and this solution is its unique maximum.
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