Determine the Value of D for a Four Period Binomial

question 52

Multiple Choice

Determine the value of d for a four period binomial model when the option's life is one-fourth of a year and the volatility is 0.64.Use the model for u and d that does not require the risk-free rate.

• A)0.85
• B)1.17
• C)2.56
• D)0.90
• E)none of the above

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Definitions:

Projective Test

A type of personality test in which the individual responds to ambiguous stimuli, revealing hidden emotions and internal conflicts.

Projective Measure

A type of personality test in which a person responds to ambiguous stimuli, revealing hidden emotions and internal conflicts.

Personality Approach

A theoretical perspective in psychology that focuses on studying individual differences in behavior and thought processes.

Measure Weakness

The process of identifying and assessing areas where performance or capability is below the desired standard.