Returning to the Simplico gold mine example, we saw in the Derivatives Pricing and the Binomial Model lecture notes that the value of the lease (without the enhancement option) was $24.1m. Without building a lattice, how could you quickly verify that this price was (approximately) correct? Or to put it another way, can you find a quick way to estimate the price of the lease without building a lattice and using backwards evaluation? Hints: Let St denote the price of gold at time t. How much is security worth St at time t worth today at time 0? Recall also (or look it up if you've never seen it before) the annuity formula for computing the value of constant cash- flow over a fixed number of time periods.