=+1. Assuming that the increment Xt+s Xt is normally distributed with mean and variance given by
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=+1. Assuming that the increment Xt+s − Xt is normally distributed with mean and variance given by equations (11.1) and (11.2), check the approximation (11.3) by taking conditional expectations in the inequality Y
σ(t, x)
√s m
≤ m i=1
m i
Y − ω
σ(t, x)
√siω
σ(t, x)
√s m−i for Y = Xt+s − Xt and ω = E(Xt+s − Xt | Xt = x).
292 11. Diffusion Processes
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