In Order for a Binomial Option Price to Approach the Black

question 52

Multiple Choice

In order for a binomial option price to approach the Black Scholes price, ________.

• A) the number of subintervals must increase substantially
• B) the volatility must be low
• C) the probability of each subinterval needs to be similar to the stock's standard deviation
• D) the interest rate needs to increase

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Definitions:

Formal Evaluation

The process of systematically assessing an employee's performance against predefined criteria or objectives through structured techniques.

Job Effectively

The proficiency and efficiency in performing tasks or responsibilities associated with one's employment.

Graphic Rating Scales

Graphic rating scales are tools used in performance appraisals where employees are rated on a scale for various competencies or behaviors.

Halo Errors

Halo Errors occur in performance assessments when the evaluator's overall impression of an individual influences their judgment on specific attributes or tasks.