Which one of the following statements is True?
a.	Black and Scholes and Merton won the Nobel Prize in Economics.
b.	Louis Bachelier founded Long Term Capital Management (LTCM).
c.	The economics Professor Paul Samuelson discovered Ito’s work on Options.
d.	The Black Scholes Merton Formula was developed in the 1950s.
e.	LTCM early success as a hedge fund using BSM methodology.


The correct answer is:

**e. LTCM early success as a hedge fund using BSM methodology.**

### Explanation:
- **a.** Incorrect because only **Merton** and **Scholes** won the Nobel Prize in Economics in 1997. **Fischer Black** was ineligible because he had passed away.
- **b.** Incorrect because **Louis Bachelier** was a French mathematician who pioneered the theory of speculation but was not associated with LTCM.
- **c.** Incorrect as **Paul Samuelson** did not discover **Itô’s work** but was influential in developing financial economics.
- **d.** Incorrect because the **Black-Scholes-Merton (BSM) formula** was developed in the early **1970s**, not the 1950s.

Long-Term Capital Management (LTCM) was indeed a hedge fund that applied the Black-Scholes-Merton (BSM) methodology in its trading strategies, making statement **e** the correct answer.

Would you like more details on the concepts here or have any questions?

### Related Questions:
1. Who were the primary developers of the Black-Scholes-Merton formula?
2. What was the role of Louis Bachelier in financial mathematics?
3. How did LTCM use the BSM model in its trading strategies?
4. What is Itô’s Lemma and its significance in financial mathematics?
5. Why did Fischer Black not receive the Nobel Prize in Economics?

### Tip:
In finance, the Black-Scholes-Merton model is foundational for options pricing, and understanding its limitations is essential in complex financial markets.

Which one of the following statements is True? a. Black and Scholes and Merton won the Nobel Prize in Economics. b. Louis Bachelier founded Long Term Capital Management (LTCM). c. The economics Professor Paul Samuelson discovered Ito’s work on Options. d. The Black Scholes Merton Formula was developed in the 1950s. e. LTCM early success as a hedge fund using BSM methodology.

Explore the correct answer to this finance question on the Black-Scholes-Merton model, LTCM, and key figures in financial mathematics. This question covers options pricing theory, Black-Scholes-Merton formula, and Itô's Lemma, essential for finance and economics undergraduates.

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