In the Black-Scholes call option pricing model, N(d₁) is the probability that: A) A standardized, normally distributed random variable is less than or equal to d₁. B) A standardized, normally distributed random variable is greater than or equal to d₁. C) The call will finish in the money. D) The call will finish out of the money. E) The call will finish at the money.

Question

Quizplus · Accepted Answer

N(d1) represents the cumulative distribution function of a standard normal distribution, indicating the probability that a standard normal random variable is less than or equal to d1.

In the Black-Scholes Call Option Pricing Model, N(d1) Is the Probability

In the Black-Scholes Call Option Pricing Model, N(d₁) Is the Probability