Use the Following Information to Answer the Question(s)below

question 19

Multiple Choice

Use the following information to answer the question(s) below.
(Please use a copy of the Cumulative Probabilities for the standard normal distribution for these problems. )
Taggart Transcontinental's stock has a volatility of 25% and a current stock price of $40 per share.Taggart pays no dividends.The risk-free interest rate is 4%.
-Which of the following is NOT an input required by the Black-Scholes option pricing model?

• A)The expected volatility of the stock
• B)The expected return on the stock
• C)The risk-free interest rate
• D)The current stock price

---

Definitions:

Probability

An evaluation of the probability that a specific event will take place.

Stockout

A situation in retail or supply chain management where the inventory of a particular item is completely depleted, leading to an inability to meet customer demand.

ABC Analysis

A method for classifying inventory items based on their importance, such as their sales volume or value, to prioritize management focus.

On-Hand Inventory

The amount of inventory physically present and immediately available in a warehouse or location at any given time.