In the Binomial Option Pricing Model The

question 21

Multiple Choice

In the binomial option pricing model the:

• A)number of intervals required for convergence is quite large.
• B)interval time span decreases as time moves forward.
• C)result based on infinitesimally small intervals will differ significantly from the value developed by the Black-Scholes model.
• D)percentage increase in price in each interval can differ from the percentage decrease in price.
• E)value of u remains constant as the number of intervals increases.

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Definitions:

Delusional Disorder

A psychiatric condition marked by the presence of one or more non-bizarre delusions without other psychotic symptoms.

Somatoform Disorder

A mental disorder characterized by physical symptoms that cannot be fully explained by any underlying medical condition.

Conversion Disorder

A mental condition where psychological stress is expressed through physical symptoms that have no organic cause.

Dissociative Disorders

A group of mental disorders characterized by a disconnection and lack of continuity between thoughts, memories, surroundings, actions, and identity.