10.10 Generalization (continued) Substituting for a we obtain f=lpf+(1-pfale-rt Where rT Options, Futures, and other Derivatives, 5th edition 2002 by John C. HullOptions, Futures, and Other Derivatives, 5th edition © 2002 by John C. Hull 10.10 Generalization (continued) • Substituting for D we obtain ƒ = [ p ƒu + (1 – p )ƒd ]e –rT where p e d u d rT = − −