Vasicek (1977) Posits a General Mean-Reverting Form for the Short-Rate $d r _ { t } = \kappa \left( \theta - r _ { t } \right) d t + \sigma d W _ { t }$

Multiple Choice

Vasicek (1977) posits a general mean-reverting form for the short-rate: $d r _ { t } = \kappa \left( \theta - r _ { t } \right) d t + \sigma d W _ { t }$ He then derives, in the absence of arbitrage, a restriction on the market price of risk $\lambda$ of any bond, where $( \mu - r ) / \eta = \lambda$ of any bond, with $\mu$ being the instantaneous return on the bond, and $\eta$ being the bond's instantaneous volatility. The derived restriction is that

A) $\lambda$ is a constant.
B) $\lambda$ may be a function of time $t$ , but not of any other time- $t$ information or of the maturity $T$ of the bond.
C) $\lambda$ may be a function of the time- $t$ short rate $r _ { t }$ , but not of current time $t$ or of the bond maturity $T$ .
D) $\lambda$ may be a function of time $t$ and the time- $t$ short rate $r _ { t }$ , but not of the bond maturity $T$ .