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a) Explain the meaning of implied volatility IM . b) Explain the meaning of vega, v , for non-dividend paying assets. c) Show the Newton-Raphson
a) Explain the meaning of implied volatility IM.
b) Explain the meaning of vega, v, for non-dividend paying assets.
c) Show the Newton-Raphson iteration for implied volatility of a non-dividend European call option.
d) Write down the pseudocode for the process in c).
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