--%>

Which numerical method should you use for BGM model

You need to price a fixed-income contract by using the BGM model. Which numerical method should you use?

E

Expert

Verified

BGM is geared up for solution along with simulation; therefore you would use a Monte Carlo simulation.

   Related Questions in Financial Management

  • Q : Explain different forms of market

    Explain different forms of market efficiency.

  • Q : Define market participants in the

    Define market participants in the foreign exchange market?The market participants which comprise the FX market can be categorized in five groups: international banks, non-bank dealers, bank customers, FX brokers, and central banks. Internation

  • Q : How two stocks fully correlated over

    How two stocks fully correlated over short timescales?

  • Q : What is Coherent Measure What is

    What is Coherent Measure?

  • Q : United State account deficits Remark on

    Remark on the following statement: "As the U.S. imports more than it exports, it is essential for the U.S. to import capital from foreign countries to finance its present account deficits."The statement presupposes that the U.S. present account

  • Q : Finance $100 is received at the

    $100 is received at the beginning of year 1, $200 is received at the beginning of year 2, and $300 is received at the beginning of year 3. If these cash flows are deposited at 12 percent, their combined future value at the end of year 3 is ________.

  • Q : Explain the argued of Eugene Fama

    Explain the argued of Eugene Fama regarding excess return.

  • Q : Fund Eurodollar loans You are an

    You are an investment banker advising a Eurobank regarding a new international bond offering it is considering.  The proceeds are to be utilized to fund Eurodollar loans to bank clients. What sort of bond instrument would you suggested that the bank consi

  • Q : United States imports more than it

    foreign countries to finance its current account deficits

  • Q : Find out the price of swap from the

    A corporation enters in a five-year interest rate swap along with a swap bank wherein it agrees to pay the swap bank a fixed-rate of 9.75 percent annually on a notional amount of DM15,000,000 and attain LIBOR - ½ percent. As of the second reset date,