The Black-Scholes model stands as a cornerstone in the field of financial mathematics, revolutionizing the way options are priced and opening new avenues for risk management and investment strategies. Developed by Fischer Black and Myron Scholes in 1973, with subsequent contributions by Robert Merton, the model provides a powerful framework for valuing European-style options in an efficient market environment. At its core, the model rests on the assumption of a frictionless market with constant volatility, where the price of the underlying asset follows a geometric Brownian motion. Through the model’s differential equation, options pricing becomes a tractable problem, yielding analytical solutions for option prices and the associated Greek parameters: delta, gamma, theta, vega, and rho. Despite its widespread adoption and effectiveness in many scenarios, the Black-Scholes model does have limitations. Its assumptions of constant volatility and frictionless markets may not always hold true in real-world conditions, leading to discrepancies between theoretical prices and observed market values.