If You Know That a Call Option Will Be Profitably

question 59

Multiple Choice

If you know that a call option will be profitably exercised then the Black-Scholes model price will simplify to _______.

• A) S₀ - X
• B) X - S₀
• C) S₀ - PV(X)
• D) PV(X) - S₀

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Definitions:

Algorithm

A set of rules or steps designed to solve a problem or accomplish a task, often used in computer programming and mathematics.

Nonconscious Process

Mental processes that occur outside of conscious awareness, influencing thoughts, feelings, and behaviors.

Conscious Awareness

The state of being awake and aware of one's surroundings and internal states, including thoughts and feelings.

Subconscious

Part of the mind that operates below the level of conscious awareness, influencing thoughts, feelings, and actions.