Which of the Following Statements Is FALSE

question 20

Multiple Choice

Which of the following statements is FALSE?

• A)N(d)is the cumulative normal distribution-that is,the probability that a normally distributed variable is greater than d.
• B)Of the five required inputs in the Black-Scholes formula,four are directly observable.
• C)The Black-Scholes formula is derived assuming that the call is a European option.
• D)The Black-Scholes Option Pricing Model can be derived from the Binomial Option Pricing Model by making the length of each period,and the movement of the stock price per period,shrink to zero and letting the number of periods grow infinitely large.

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Definitions:

Systematic Desensitization

A behavioral therapy technique used to reduce phobic responses through gradual exposure to the feared object or situation while maintaining relaxation.

Cognitive Therapy

A form of psychotherapy that aims to change negative patterns of thinking or behavior that are causing a person's emotional or mental problems.

Panic Disorder

A mental health condition characterized by sudden and repeated episodes of intense fear and physical symptoms, such as chest pain and heart palpitations.

Freud

Refers to Sigmund Freud, the founder of psychoanalysis, known for his theories on the unconscious mind, sexuality, and dream analysis.