Which of the Following Statements Is FALSE

question 33

Multiple Choice

Which of the following statements is FALSE?

• A)If you take the option price quoted in the market as an input and solve for the volatility,you will have an estimate of a stock's volatility known as the implied volatility.
• B)The Black-Scholes formula can be used to price American or European call options on non-dividend-paying stocks.
• C)We need to know the expected return on the stock to calculate the option price in the Black-Scholes Option Pricing Model.
• D)We can use the Black-Scholes formula to compute the price of a European put option on a non-dividend-paying stock by using the put-call parity formula.

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Definitions:

Sociofugal

Space design intended to discourage social interaction among individuals within it.

Territory

An area of land or space that an individual or group claims, controls, or occupies, often marked and defended from others.

Dorm Room

A private living space within a dormitory at a college or university, typically consisting of sleeping and study areas for a single occupant or shared by roommates.

Classroom

A room or space where teaching and learning activities take place, typically found in educational institutions.