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Normal distribution tables - Black Scholes Model

Mmassif14y ago
What happens when the values calculated for d1 and d2 are not exactly those shown in the normal distribution tables, as is often the case ?

For example if I calculate d1 as 0.9286 do I simply add 0.3212 + 0.3238 = 0.645 and divide by 2 to get 0.3225. Add 0.5 to the latter to get d1= 0.8225. This is the method I've been using but I doubt it is the accurate one.

Please help

Massif
John MoffatJohn MoffatTutor14y ago#1
You are not expected to get an exact figure for N(d)

What you are doing is fine, but in fact for the exam you only need to take the nearest figure (i.e. for N(d1) if d1 is 0.9286, just round to two places and look up 0.93 in the tables.
Mmassif14y ago#2
I will try that from now on. Thank you.
John MoffatJohn MoffatTutor14y ago#3
You are welcome.
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