The Term [N(d₂)× PV(EX)] in the Black-Scholes Model Represents the

question 10

Multiple Choice

The term [N(d₂) × PV(EX) ] in the Black-Scholes model represents the

• A)call option delta.
• B)bank loan.
• C)put option delta.
• D)present value of a bank loan.

---

Definitions:

Income Change

Income change refers to any variation, either an increase or decrease, in the amount of revenue or profit that an entity receives over a period.

Variable Costing

An approach to costing that accounts for only variable production expenses, including direct materials, direct labor, and variable manufacturing overhead, in the calculation of product costs.

Absorption Costing

A costing approach that consolidates every expense related to manufacturing - direct materials, direct labor, and both variable and fixed overheads - into the product’s price.

Variable Production Costs

Costs that change in proportion to the level of production activity, such as materials and labor directly involved in manufacturing.