Which One of the Five Factors Included in the Black-Scholes

question 64

Multiple Choice

Which one of the five factors included in the Black-Scholes model cannot be directly observed?

• A)risk-free rate
• B)strike price
• C)standard deviation
• D)stock price
• E)life of the option

---

Definitions:

Defenses

Legal strategies and arguments used by a defendant to challenge the validity of the charges or claims against them.

Breach-of-Contract

A legal violation occurring when one party fails to fulfill an obligation stipulated in a contract, leading to potential legal action.

Intellectual Property

A category of property that includes intangible creations of the human intellect, such as inventions, literary and artistic works, symbols, names, and images used in commerce.

Categories

Classifications or groups of items, information, or concepts that share common characteristics or attributes.