BinModel.cpp

#include "BinModel.h"
#include <iostream>
#include <cmath>

using namespace std;

double BinModel::RiskNeutProb() {
    return (R - D) / (U - D);
}

double BinModel::S(int n, int i) {
    return S0 * pow(1 + U, i) * pow(1 + D, n - i);
}

int BinModel::GetInputData() {
    // Entering data
    cout << "Enter S0: "; cin >> S0;
    cout << "Enter U:  "; cin >> U;
    cout << "Enter D:  "; cin >> D;
    cout << "Enter R:  "; cin >> R;
    cout << endl;

    // Making sure that 0 < S0, -1 < D < U, -1 < R
    if (S0 <= 0.0 || U <= -1.0 || D <= -1.0 || U <= D || R <= -1.0) {
        cout << "Illegal data ranges" << endl;
        cout << "Terminating program" << endl;
        return 1;
    }

    // Checking for arbitrage
    if (R >= U || R <= D) {
        cout << "Arbitrage exists" << endl;
        cout << "Terminating program" << endl;
        return 1;
    }

    cout << "Input data checked" << endl;
    cout << "There is no arbitrage" << endl << endl;

    return 0;
}

double BinModel::GetR() {
    return R;
}

double BinModel::GetU() {
    return U;
}

double BinModel::GetD() {
    return D;
}

double BinModel::GetS0() {
    return S0;
}