Appropriate for valuing american call options

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A derivative analyst and his manager are debating how to value an American call option on Lyft's stock with two years left to expiration. Lyft is a newly publicly-traded company and is not expected to pay dividends at any point in the next two years. The analyst suggests using the Black-Scholes model to value the option. The manager objects, saying "the Black-Scholes model is only valid for European call options. It is never appropriate for valuing American call options since it does not account for the option to exercise before the expiration date." Do you agree with the manager?

Reference no: EM133114182

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