Cubic Splines…
A) Apply no-arbitrage
B) Ensure smooth transitions at knots
C) Iteratively implement bootstrapping until there’s convergence
D) All of the Above
test
Cubic Splines…
A) Apply no-arbitrage
B) Ensure smooth transitions at knots
C) Iteratively implement bootstrapping until there’s convergence
D) All of the Above
The answer is B) Ensure smooth transitions at knots.