Answer: The Cox-Ingersoll-Ross model

**Explanation:** - **Option A (Vasicek model)**: This model assumes constant volatility for the short rate, meaning the volatility parameter does not change over time. - **Option B (Ho-Lee model)**: This model also assumes constant volatility for the short rate in its basic formulation. - **Option C (Cox-Ingersoll-Ross model)**: This model includes varying short-rate volatility where the volatility is proportional to the square root of the interest rate level (σ√r). This means volatility increases with higher interest rates and decreases with lower interest rates, making it more realistic than constant volatility models.

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