The probability for an up-movement on a binomial tree is (a d)/(u d). Explain how
Question:
The probability for an up-movement on a binomial tree is (a − d)/(u − d). Explain how the growth factor a is calculated for
(a) a non-dividend-paying stock,
(b) a stock index,
(c) a foreign currency, and
(d) a futures contract.
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Related Book For 
Fundamentals Of Futures And Options Markets
ISBN: 9781292422114
9th Global Edition
Authors: John Hull
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