The Black-Scholes-Merton model assumes __________ volatility.
A) stochastic
B) high
C) low
D) constant
E) random

Name: The Black-Scholes-Merton model assumes __________ volatility. A) stochastic B) high C) low D) constant E) random
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The Black-Scholes-Merton model assumes constant volatility. This means that the volatility of the underlying asset doesn't change over time, which is a simplifying assumption that makes the model easier to use. However, in reality, volatility can and does change.

The Black-Scholes-Merton Model Assumes __________ Volatility