How to Find Binomial Probabilities Using a Statistical Formula. N number of trials. To learn more about the binomial distribution go to Stat Treks tutorial on the binomial distribution.
So now lets get our calculator out and actually do that.
The value of a put option using single-period binomial model can be calculated using the following formula. This is all buildup for the binomial distribution so you get a sense of where the name comes. Alright so now we have our graphing calculator out. This is the first example on how to find binomial probabilities using the Binomial formula.