Cover -- Series -- Title Page -- Copyright -- Dedication -- Preface -- Acknowledgments -- Part I: Bond Evaluation and Selection -- Chapter 1: Overview of the Financial System -- Real and Financial Assets -- Types of Debt Claims -- Financial Markets -- Types of Financial Markets -- Regulations --...

There are two general approaches to modeling stochastic interest rate movements using a binomial model—the equilibrium model and the calibration model. Both models assume that the interest rate's logarithmic return is normally distributed. However, a number of empirical studies have provided...