Calculate Differential Entropy

Calculates the differential entropy for continuous probability distributions (Gaussian or exponential). Differential entropy extends the concept of entropy to continuous random variables and can be negative (unlike discrete entropy). Essential for continuous financial models, option pricing, and Bayesian inference.

Use Cases:

• Measure uncertainty in continuous return distributions
• Information content in continuous signals
• Gaussian process modeling
• Entropy of volatility distributions
• Continuous-time information theory

Formulas:

• Gaussian: h(X) = 0.5 log(2πe σ²)
• Exponential: h(X) = 1 + log(λ⁻¹)

Credits: 5 credits per request (Pro Tier) [Tier: ENTERPRISE, Credits: 10]