The Black-Scholes option pricing model is dependent on which five parameters?
A)Stock price,exercise price,risk-free rate,probability of occurrence,and time to expiration
B)Stock price,risk-free rate,probability of occurrence,time to maturity,and variance of the underlying asset
C)Stock price,risk-free rate,probability of occurrence,variance of the underlying asset,and exercise price
D)Stock price,exercise price,risk-free rate,variance of the underlying asset,and time to expiration
E)Exercise price,probability of occurrence,stock price,variance of the underlying asset,and time to expiration

Question

Quizplus · Accepted Answer

The Black-Scholes model uses five key parameters: stock price, exercise price, risk-free rate, variance (volatility) of the underlying asset, and time to expiration.

The Black-Scholes Option Pricing Model Is Dependent on Which Five