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Answer the following show the work: Which of the following is an assumptions of the Black-Scholes-Merton (BSM) option-pricing model? A. the risk free rate is
Answer the following show the work:
Which of the following is an assumptions of the Black-Scholes-Merton (BSM) option-pricing model?
| A. | the risk free rate is positively correlated with the underlying stock price. | |
| B. | Transaction costs are zero. | |
| C. | Options valued are American style. | |
| D. | The distribution of the underlying stock price is normal. |
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