You have a project valued at 2 0 0 that could increase or decrease by 2 5
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Question:
You have a project valued at that could increase or decrease by per period for two periods.
The project has three embedded options: option to abandon at ;
a contraction option with a strike of with an of original value; and
an expansion option with a strike of with of original value.
The risk free rate is and the WACC is
What is the value of all the options combined?
Related Book For
OM operations management
ISBN: 978-1285451374
5th edition
Authors: David Alan Collier, James R. Evans
Posted Date: