16) Perpetual options Flashcards
(4 cards)
1
Q
What is a perpetual option, and how does it simplify the Black-Scholes equation
A
2
Q
What is the ODE for a perpetual American put and what form do its solutions take
A
3
Q
What is the general solution to the ODE for a perpetual American put option
A
4
Q
Describe the derivation of the analytical solution for the perpetual American put option
A
