Discrete time model and the black-scholes

Assignment Help Finance Basics
Reference no: EM132589783

Explain what we mean when we say that the binomial model is a discrete time model and the Black-Scholes-Merton model is a continuous time model.

Reference no: EM132589783

Questions Cloud

Explain the difference between the profit calculated : Explain the difference between the profit calculated in the trading account compared with the profit calculated in the profit and loss account.
What is a fair price for the property : Huiling owns a rental property on Main street, but she is considering selling the property to another real estate investor.
Define characteristics of native religions : Define characteristics of native religions and, based on Internet research, show how contemporary indigenous spiritual paths are related to these characteristic
Prepare the interest payment entry for troubled on december : Using time value of money tables, a financial calculator, and computer spreadsheet functions, discuss whether or not Troubled should record a gain
Discrete time model and the black-scholes : Explain what we mean when we say that the binomial model is a discrete time model and the Black-Scholes-Merton model is a continuous time model.
Describe your classroom management plan : Describe your classroom management plan. This can simply be the poster you created for the Week Three, Discussion Two forum, or you can develop a summary.
Normal and a lognormal distribution : Explain the difference between a normal and a lognormal distribution as it pertains to stock prices.
What is the bond current yield : What is the bond's current yield (enter answer as a percentage)?
Calculate the implicit gains or losses : Recently, your MNE in Malaysia has just bought fabrics from a U.S. company, with payment of $1 million due in 6 months.

Reviews

Write a Review

Finance Basics Questions & Answers

  What will be the value of the company

The cost of equity is 12%. What will be the value of equity of the firm? What will be the value of the company if it has a debt of $7.5 million?

  Cost of retained earnings

Weir Inc. has a target capital structure of 40% debt, 20% preferred, and 40% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of retained earnings is 9.6%, and the tax rate is 40%. The WACC for..

  Responsible for the different skin texture phenotypes

If you extract blood samples, can you use those samples to identity certain alleles responsible for the different skin texture phenotypes.

  Explain what is meant by the yield curve

Explain what is meant by the yield curve and briefly outline three theories to explain unequal yields at different maturities and how it is most often sloped.

  Effective annual rate of return for the bill

Q.1 (a) A treasury bill with 120 days until maturity has an;

  What is the future value of a annuity payment

What is the future value of a $530 annuity payment over four years if interest rates are 8 percent?

  What were timber cash flows from operating activities 2010

If it's marginal tax rate was 30%, what were Timber's cash flows from operating activities for 2010?

  External funding-flow of funds-interest rates

Discuss the process to calculate external funding needs and the importance to a business. Describe the importance of interest rates, and how risk is considered to businesses and economic activity.

  Now the required return on an average stock increases by

ccc corp has a beta of 1.5 and is currently in equilibrium. the required rate of return on the stock is 12.00 versus a

  What effect on the future value of an annuity

What effect on the future value of an annuity does increasing the interest rate have? Does a change from 4% to 6% have the same dollar effect as a change from 6% to 8%?

  Find the capital gains yield

Calculation of Firms growth Rate and Capital Gains Yield at given dividend options -  Find the Capital Gains Yield?

  Find a potential capital project

Find a potential capital project for your company describe such a project and write a short summary of the problems you see in getting the funding to see it through.

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd