Binomial Tree Option Pricing › Quiz

Michael BrenndoerferDecember 1, 20251 min read
Quantitative FinanceAll chapters
Part 6 of 15Numerical Methods for Derivative Pricing
Chapter 33Binomial Tree Option Pricing › Quiz
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Binomial Tree Option Pricing

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In the binomial model, the risk-neutral probability p=erT−du−dp=\frac{e^{rT}-d}{u-d} represents: