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Black Scholes

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Black Scholes

  • This topic has 1 reply, 2 voices, and was last updated 13 years ago by AvatarAnonymous.
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  • November 20, 2012 at 12:09 pm #55525
    Avatarcharitylombe
    Member
    • Topics: 1
    • Replies: 5
    • ☆

    I would like to know the pa of an Option to abandon, For the pe I know it is the salvage value and on the timing of the option to abandon. Is it period that it will take to abandon or what?

    The June,2011 had black scholes to delay why did they pick 2 yrs and the cash inflow started in year three but on the question it started in year 1. please help

    November 20, 2012 at 2:24 pm #108039
    AvatarAnonymous
    Inactive
    • Topics: 0
    • Replies: 12
    • ☆

    Hi Lombe,

    The pa is usually the amount invested,the time is the period required before the option is exercised.When the option will exercised.

    June 2011 was trick…are you in Lusaka Lombe.But i suppose its the 22 +2 months period that comes to 2years before the film is released.

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