The Black-Scholes option pricing model can be used for:
A)American options but not European options.
B)European options but not American options.
C)call options but not put options.
D)put options but not call options.
E)both zero coupon bonds and coupon bonds.

Question

Quizplus · Accepted Answer

The Black-Scholes option pricing model is specifically designed for pricing European options, which can only be exercised at expiration. It is not suitable for pricing American options, which can be exercised at any time before expiration.

The Black-Scholes Option Pricing Model Can Be Used For