The Black-Scholes Option Pricing Model Is

question 149

Multiple Choice

The Black-Scholes option pricing model is:

• A) Applicable to both American and European put options given an option period of one year or less.
• B) A simplified method of determining the value of a stock given the value of its American style options.
• C) Based on European-style call and put options.
• D) Used in conjunction with the put-call parity formula to determine the value of a call.
• E) The basis for proving that European puts are more valuable than comparable American puts.

---

Definitions:

External Causes

Factors outside of an individual's control that influence events, actions, or outcomes.

Behavior Potential

The likelihood that a particular behavior will occur in a specific situation, influenced by the individual's skills, motivations, and environmental factors.

Self-concept

An individual's understanding and evaluation of their own behaviors, traits, and values, forming the basis of their identity.

Radical Behaviorism

A philosophical doctrine and approach in psychology that emphasizes the study of observable behaviors and their modification without attributing importance to thoughts or feelings.