The Black-Scholes Formula Is Notable Because It Does Not Require

question 55

Multiple Choice

The Black-Scholes formula is notable because it does not require us to know ________.

• A) the expected return on a stock
• B) the risk-free rate
• C) the volatility of the stock
• D) the dividend rate on the stock

---

Definitions:

Mental Age

A measure of an individual's cognitive ability compared to the average cognitive ability of an individual at a specific age.

IQ

Intelligence Quotient, a measure of a person's intellectual abilities in relation to others.

Dallas

A major city in the state of Texas, known for its historical significance in the oil and cotton industries and as the site of President John F. Kennedy's assassination in 1963.

Metacognition

The awareness and understanding of one's own thought processes, or thinking about thinking.