Another Case:

Rather than thinking about a multiperiod case, let's think about multiple subdivisions within a given period. Suppose that when a stock goes up in a subperiod it goes up to uS where u>1 and when a stock goes down during a period is goes down to dS where 0<d<1. Further, assume that there are four subperiods to the period in question.

What does the distribution of possible outcomes look like?

What happens to the distribution as the number of subperiods goes to infinity?