A ________ Is an Option Valuation Model Based on the Assumption

question 1

Multiple Choice

A ________ is an option valuation model based on the assumption that stock prices can move to only two values over any short time period.

• A) nominal model
• B) binomial model
• C) time model
• D) Black-Scholes model

---

Definitions:

Balance Sheet

A report documenting an organization's financial status, including its assets, liabilities, and the equity owned by shareholders, as of a certain date.

Buildings Equipment

Fixed assets such as physical structures and machinery owned by a business for use in operations, not for immediate resale.

Order Liquidity

The ease with which an order can be filled in a market without affecting the current price of the asset.

Declaration Dividend

The act of a company's board of directors formally announcing the payment of a dividend to shareholders.