Calculation of cumulative normal probabilities within the


1. If there are no dividends on a stock, which of the following statements is correct?

An American call will be immediately exercised

An American call and an American put will sell for the same price

None of the above

A European call will sell for more than an American call

An American call will sell for more than a European call

2. The standard normal random variable used in the calculation of cumulative normal probabilities within the Black-Scholes-Merton option pricing model is

the d1 and d2 statistic

none of the above

the z statistic

the lognormal distribution

the f distribution

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Financial Management: Calculation of cumulative normal probabilities within the
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