22.5 Blacks model its extensions Blacks model is similar to the Black-Scholes model used for valuing stock options It assumes that the value of an interest rate, a bond price, or some other variable at a particular time T in the future has a lognormal distribution Options, Futures, and other Derivatives, 5th edition 2002 by John C. HullOptions, Futures, and Other Derivatives, 5th edition © 2002 by John C. Hull 22.5 Black’s Model & Its Extensions • Black’s model is similar to the Black-Scholes model used for valuing stock options • It assumes that the value of an interest rate, a bond price, or some other variable at a particular time T in the future has a lognormal distribution