The Black-Scholes Model is a mathematical model used to determine the theoretical price of European-style options, which are financial derivatives that can only be exercised at expiration. This model provides a framework for valuing options by incorporating variables such as the underlying asset price, the strike price, time to expiration, risk-free interest rate, and volatility. Understanding this model is crucial for managing currency derivatives and mitigating financial risks associated with fluctuations in exchange rates.