In the Vasicek one factor model, the short rate determines the model. In the Vasicek two factor model, what rates drive the model?
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Q1: Is the 2-factor Vasicek model an afine
Q2: What are multifactor models?
Q3: Show that, given: Q5: Does the 2-factor Vasicek model fit the Q6: Given that we now have two stochastic Q7: Why is it considered that implied volatility Q8: What peculiarity of a yield curve steepner Q9: When are multifactor models used? Q10: What modi?cations should be included to Ito's Q11: How is the multivariate Ito's lemma defined?
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