What is Merton's contribution to finance?
Behavioral finance
Continuous-time option pricing
Microfinance
Public finance
Answer
Continuous-time option pricing is Merton's significant contribution to finance. His work extended the Black-Scholes model to incorporate continuous trading, allowing for more accurate pricing of options in real-world markets. This innovation revolutionized option pricing and risk management, providing a more realistic framework for valuing and hedging financial instruments.
Mastering Merton: A Deep Dive into the Legacy of Robert C. Merton
Related Quizzes
Subscribe Now!
Learn something
new everyday
Playing quizzes is free! We send 1 quiz every week to your inbox