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RDP 8902: Option Prices and Implied Volatilities: An Empirical Analysis
Equation (6)
(
T
−
(
t
+
1
)
)
σ
2
(
t
+
1
,
T
)
+
ε
t
+
1
2
=
(
T
−
t
)
α
+
β
(
T
−
t
)
σ
2
(
t
,
T
)
+
(
T
−
t
)
γz
t
+
v
t
+
1
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