Black–Derman–Toy model

The Black–Derman–Toy model (BDT) is an mathematical equation used to help people understand how interest rates may fluctuate over time. It is similar to a graph, where the interest rate is on the vertical (up and down) axis and the time is on the horizontal (left and right) axis. The BDT equation helps people understand how interest rates can change over different periods of time and can help predict where the interest rate may go in the future.