Task: Can you give me some very brief answers to my questions?
Option Pricing
- What is the law of one price?
- How do you determine lower and upper bounds?
- How do you use put-call parity?
- What is the binomial option-pricing model?
- How do you calculate option premiums using the binomial pricing model and put-call parity?
The Black-Scholes Option Pricing Model.
- What is the Black-Scholes option-pricing model?
- How do you apply the Black-Scholes option-pricing model?
- What is historical volatility?
- How do you find implied volatility?
- What is Merton's model?