"In the interest rate area, traders have for a long time used a version of what is known as Black's model for European bond options; another version of the same model for caps and floors; and yet another version of the same model for European swap options"

This quote by John C. Hull is describing the use of Black's model in the rate of interest area. Black's design is a mathematical design utilized to price alternatives, and it has been utilized by traders for a long time to cost European bond choices, caps and floorings, and European swap choices. The design is versatile and can be adapted to various kinds of alternatives, allowing traders to precisely price various types of alternatives. The quote is stressing the value of Black's design in the rates of interest area, and how it has actually been used for a long period of time by traders to price various kinds of alternatives. The quote is likewise highlighting the versatility of the design, as it can be adapted to different kinds of alternatives.