Why is the binomial model a useful technique for approximating options prices from the Black ScholesMerton model?

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Why is the binomial model a useful technique for approximating options prices from the Black– Scholes–Merton model? Describe some applications and uses of this model.

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An Introduction to Derivative Securities Financial Markets and Risk Management

ISBN: 978-0393913071

1st edition

Authors: Robert A. Jarrow, Arkadev Chatterjee

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Question Posted: Dec 02, 2015 03:30 AM

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Why is the binomial model a useful technique for approximating options prices from the Black ScholesMerton model?

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The binomial model is a useful numerical technique because it ...View the full answer

An Introduction to Derivative Securities Financial Markets and Risk Management

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