Which financial model did Merton help develop?
CAPM
Black-Scholes-Merton
IS-LM
Solow Growth
Answer
The Black-Scholes-Merton model, developed by Fischer Black, Myron Scholes, and Robert Merton, is a mathematical model used to price options. It takes into account factors such as the underlying asset's price, volatility, risk-free interest rate, and time to expiration. The model is widely used by financial professionals to value and trade options.
Mastering Merton: A Deep Dive into the Legacy of Robert C. Merton
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