Bonus Problem 41 Numerous variations on the basic design of options have been proposed. These "nonstandard" options are sometimes called as exotic options. One example2 is a barrier option, which is an option where the payoff depends on whether the underlying asset price reaches a certain level during a certain period of time. There are several types of barrier options and can be classified as either knock-out options or knock-in options.A knock-out option ceases to exist when the underlying asset price crosses a barrier. If the underlying asset price begins below the barrier and must cross above it to cause the knock-out, the option is called as up-and-out. A down-and-out option has the barrier below the initial asset price