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Basic Question 6 of 9

An interest rate tree is based on ______ and ______.

User Contributed Comments 2

User Comment
connor15 The relationship among the set of rates associated with each individual nodal period is a function of the interest rate volatility assumption of the model being employed to generate the tree.
JNW1980 Smoke and mirrors....
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Edward Liu

Edward Liu

Learning Outcome Statements

describe a binomial interest rate tree framework;

CFA® 2025 Level II Curriculum, Volume 4, Module 27.