Which of the following statements is most valid for the recursive programming of a binomial tree for pricing options?
A)The recursive program requires more lines of code than a non-recursive loop-driven program.
B)The recursive program requires less computer memory than a non-recursive loop-driven program.
C)The recursive program runs slower than a non-recursive loop-driven program.
D)The recursive program runs in polynomial time whereas a non-recursive loop-driven program runs in exponential time.

Question

Quizplus · Accepted Answer

The recursive program requires fewer lines of program code,as a recursion can often be written in one line.In the recursive program,the computer needs to keep all nodes on the stack and this uses a lot of memory,whereas non-recursive program code can be written to only hold one period's nodes in memory at a time.Further,the recursive program operates as if the model is based on a non-recombining tree,and hence,requires exponential time to run.

Which of the Following Statements Is Most Valid for the Recursive