Question: Consider a Binomial model with T=3. Consider the partitions P1 and P2 (as defined in lectures) of the sample space ={ 1, 2,, 8 }.

Consider a Binomial model with T=3. Consider the partitions P1 and P2 (as defined in lectures) of the sample space ={ 1, 2,, 8 }. Explicitly write the -algebras (a) F1 = (P1) (b) F2 = (P2 ) Also explicitly compute Ep[S2F1 ]. Be sure to justify each step.

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