A Multiperiod Binomial Model Prices an Interest Rate Derivative By

A multiperiod binomial model prices an interest rate derivative by:

A) computing an expected payoff of the derivative's values using actual probabilities
B) computing an expected payoff of the derivative's values using pseudo-probabilities
C) computing an expected value,using actual probabilities,of the derivative's values,discounted by the spot rates
D) computing an expected value,using pseudo-probabilities,of the derivative's values,discounted by the spot rates
E) None of these answers are correct.