Which of the following is true?
A) The implicit finite difference method is equivalent to using a trinomial tree
B) The explicit finite difference method is equivalent to using a trinomial tree
C) Both methods are equivalent to using a trinomial tree
D) Neither method is equivalent to using a trinomial tree

Question

Quizplus · Accepted Answer

The explicit finite difference method is equivalent to using a trinomial tree.The implicit finite difference method is equivalent to using a multinomial tree.

Which of the Following Is True