In the Cox-Ingersoll-Ross (1985)model,interest Rates Are Specified by the Following $d r _ { t } = k \left( \theta - r _ { t } \right) d t + \sigma \sqrt { r _ { t } } d W _ { t }$

question 14

Multiple Choice

In the Cox-Ingersoll-Ross (1985) model,interest rates are specified by the following stochastic process: $d r _ { t } = k \left( \theta - r _ { t } \right) d t + \sigma \sqrt { r _ { t } } d W _ { t }$ The process for interest rates is mean-reverting if

• A) \(k > 0\)
• B) \(k < 0\)
• C) \(\theta > 0\)
• D) \(\theta < r _ { t }\)

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