Explain how the value of a real option to temporarily shut down a mine can be analyzed

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Explain how the value of a "real option to temporarily shut down a mine" can be analyzed with system dynamic simulation. Explain what is needed for the analysis, how is the analysis done in practice.

What is the analysis result, and how are the results interpreted? Use drawings, if they help explaining the issues.

Related Book For answer-question

Macroeconomics

ISBN: 978-0138014919

12th edition

Authors: Robert J Gordon

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Posted Date: May 17, 2023 02:40 AM

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Explain how the value of a real option to temporarily shut down a mine can be analyzed

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SOLUTION The value of a real option to temporarily shut down a mine can be analyzed using a system dynamic simulation This approach involves building a mathematical model of the mine and its operation ... View the full answer

Macroeconomics

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