When we should advice about the option to Expand , Delay , Redeploy , Withdrawal ?? i mean what information that should be consider i.e NPV or other??
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Black Scholes - Real Option
11y ago#1I am not quite sure what you mean.
Having the option to 'do something in the future' (whatever option it is) will have a value (from the formula) which will make the project more valuable than it would be without the option.
The NPV of the project with the option is the NPV without the option + the value of the option.
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