Question: > A Click Submit to complete this assessment. Question 9 The BSOPM assumes that the logarithms of the returns of the underlying stock are normally

> A Click Submit to complete this assessment. Question 9 The BSOPM assumes that the logarithms of the returns of the underlying stock are normally distributed. Why is this a concern? Logarithms will never follow a normal distribution This is a reasonable assumption for most stocks Logarithms always follow a binomial distibution D. Stock returns do not follow any patterns Click Submit to complete this assessment

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock blur-text-image

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Question Completion Status: 1 2 SL 5 8 9 Save and Submit A Click Submit to complete this assessment. Question 9 Question 9 of 9 0.5 points Save Answer Manama Corporation owns 80% of Ibra Inc.'s...

please I dont know the aswers and need help, seriously suck.. Question 3 Moving to another question will save this response. Question 3 3 points On November 1, Alan Company signed a 120-day, 12 note...

i only have an hour so someone please help asap Remaining Time: 8 minutes, 40 seconds. Question Completion Status Close Moving to another question will save this response Question 1 Question 1...

show the steps and explian markets). QUESTION 25 Investors trade previously issued securities in the O primary secondary primary and secondary derivatives QUESTION 26 If a portfolio had a return of...

Stue and Sub Click Submit to complete this assessment. Question 10 of 10 Question 10 1 points are Suppose a put option with a strike price of S70 has a premium of $4, while another put on the same...

The following comparative balance sheets 2019 & 2020 and additional information for "National Company" are given: Assets Dec. 31, 2020 Dec. 31, 2019 Cash $152,000 $44,000 Accounts Receivable 48,000...

Question completion Status Moving to another question will save this response. Question 7 A pension fund manager is investing 40% of the investment budget on a stock (S) and 60% on a bond (B). The...

10 points Save Answer You purchased 500 shares of Kaldwin Inc. common stock one year ago for $33.8 per share. You received total dividends of $2.75 per share over the last year and decide to close...

Moving to another question will save this response Question 9 An investment will give you monthly payments of $612 for 7 years. If your required return is 11.34%, what is it worth today? submit to...

Dear Sir I would like the answers of the attached exams. only calculations Student id. .................................. School of Business and Economics EXAMINATION Course : Risk Management...

Suppose F() is the Fourier transform of f(x). If fx|f(x)|dx \(x)|dx 5 |F()|d S\F()|d Ex www exist, then ExE 1/1. and Ep

There is a database that contains a website's traffic data over a period of 30 days. The first table contains users' information including the user type (user, crawler, admin). The second table...

the next part def load_inventory () : 1 usage This function reads in a single list data structure from a binary file named inventory. dat and stores it in a variable that holds this inventory list...

On 1 March 2007 DB Limited issued R560 000 15% debentures at R98. The debentures were to be redeemed at par in four equal annual payments starting 28 February 2010. Required: Journalise the above...