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The binomial model is a discrete-time version of the geometric Brownian motion model, which is the basis for the Black-Scholes-Merton Model. Discuss and critically review

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The binomial model is a discrete-time version of the geometric Brownian motion model, which is the basis for the Black-Scholes-Merton Model. Discuss and critically review the assumption about volatility underlying the Black-Scholes-Merton Model. (10\%)

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