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PRMIA Exam 8007 Topic 1 Question 62 Discussion

Actual exam question for PRMIA's 8007 exam
Question #: 62
Topic #: 1
[All 8007 Questions]

When calculating the implied volatility from an option price we use the bisection method and know initially that the volatility is somewhere between 1% and 100%. How many iterations do we need in order to determine the implied volatility with accuracy of 0.1%?

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Suggested Answer: D

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