Why Does the Black Scholes Call Formula Use the Present

question 47

Multiple Choice

Why does the Black Scholes call formula use the present value of the exercise price and not merely the exercise price in the formula?

• A) All finance must use the time value of money
• B) Call options are rarely exercised early
• C) You cannot exercise an option early
• D) Because the put option uses the future value

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Definitions:

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A mental disorder characterized by a long-term pattern of exaggerated self-importance, need for admiration, and a lack of empathy.

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Culture-bound Disorders

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